REPORT 


OF   THE 


Commission   for  the   Revision  of   the    Taxation 

System  of  the  State  of  Maryland 

and  City  of  Baltimore 


Appointed  in  Pursuance  of  Chapter   779    of  the  Acts   of   the   General  Assembly 

of  Maryland  of    1912 


HENRY  F.  BAKER,  Baltimore  C«.,  ChairmanN 
J.  BARRY  MAHOOL.  Baltimore  Gty 
E.  STANLEY  GARY.  Baltimore  City 
I.  H.  GAMBRILL,  Jr..  Frederick  County 
WILLIAM  M.  COOPER,  Wicomico  County  1 
VERNON  COOK,  Baltimore  City 


COMMISSIONERS 


ALLAN  C.  GIRDWOOD.  Secretary 


BALTIMORE.  MD. 


1913 


d 


THE  LIBRARY 

OF 

THE  UNIVERSITY 

OF  CALIFORNIA 

LOS  ANGELES 


C' 


OF   THE 


REPORT 

Commission   for  the    Revision   of    the    Taxation 

System  of  the  State  of  Maryland 

and  City  of   Baltimore 


Appointed  In   Pursuance  of  Chapter   779   of  the  Acts   of   the   General  Assembly 

of  Maryland  of    1912 


HENRY  F.  BAKER,  Baltimore  Co.,  Chairman; 

J.  BARRY  MAHOOL,  Baltimore  City 

E.  STANLEY  GARY,  Baltimore  City 

)  COMMISSIONERS 

J.  H.  GAMBRILL,  Jr.,  Frederick  County 
WILLIAM  M.  COOPER,  Wicomico  County^ 
VERNON  COOK,  Baltimore  City 


ALLAN  C.  GIRDWOOD,  Secretary 


BALTIMORE,  MD. 

1913 
SEP  111930 


ACKNOWLEDGMENT. 

The  Commission  desires  to  acknowledge  the  many  valuable 
suggestions  made  by  Eugene  H.  Hickok,  of  the  United  States 
Bureau  of  Corporations,  and  to  acknowledge  the  earnest  co- 
operation of  H.  Findlay  French,  Esq.,  in  lines  of  investigation  and 
other  assistance  rendered  by  him.  Acknoivledgment  is  also  made 
of  the  valuable  co-operation  of  all  State  and  local  officials,  includ- 
ing County  Commissioners,  Mayors  of  cities,  towns  and  villages. 
Clerks  of  Courts  and  County  Treasurers,  and  especially  Hon. 
Oscar  Leser,  Chief  Judge  of  the  Appeal  Tax  Court  of  Baltimore 
City;  Dr.  Horace  E.  Flack,  Executive  of  the  Bureau  of  Legisla- 
tive Reference  of  Baltimore  City;  Harry  J.  Hopkins,  Deputy 
Comptroller  of  the  State,  and  the  employees  of  the  Comptroller's 
office  and  the  State  Tax  Commissioner's  office. 


A7 


CONTENTS. 

Page 
Introduction  7-8 

Report  and  Recommendations  of  the  Commission 9-55 

Permanent  tax  commission.  Tax  commission  in  other  States. 
Assessment  methods  in  Maryland.  Collection  of  taxes.  Cor- 
porations :  Domestic  and  manufacturing.  Bonus  tax :  Gross 
receipts  tax ;  freight  car  companies ;  foreign  corporations ; 
foreign  fertilizer  corporations ;  banks ;  insurance  companies. 
Taxation  of  intangible  personal  property ;  mortgages ;  inheri- 
tances. Taxation  of  public  obligations ;  income ;  mineral  de- 
posits ;  woodlands.  Exemptions :  Article  XV  of  the  Bill  of 
Rights ;  licenses ;  fee  system ;  school  taxation ;  aid  to  charitable 
institutions  ;  good  roads  ;  tax  plats  ;  true  consideration  in  deeds  ; 
cost  of  government  in  Maryland. 

Finances  of  Maryland :  Sources  of  revenue ;  comparative  table  of 
sources  in  other  States ;  separation  of  sources ;  general  prop- 
erty tax;  levies  since  1900;  1912  and  1913  levies  compared. 
Sinking  funds  of  loans ;  sinking  fund  of  1908  road  loan ; 
serial  bonds. 

Basic  need  of  Maryland. 

Assessment  in  Maryland 56-168 

Tax  assessors:  Methods  of  assessment  of  farm  property;  of  town 
property ;  of  personal  property.  Assessment  books  :  Alienation 
lists ;  time  of  levy. 

Result  of  present  administrative  methods :  Assessment  variations 
between  counties,  as  to  real  property,  personal  property,  securi- 
ties, railroads  and  telephone  companies. 

Local  variations  in  assessments  as  to  farmland,  acreage,  town 
property ;  county  assessments  vs.  town  assessments ;  personal 
property,  securities.  Assessments  on  large  properties.  Assess- 
ments in  Baltimore  City. 

Reports  from  each  county. 

Reassessment  in  Maryland 169-215 

Acts  for,  since  1777 ;  intervals  between.  The  Acts  of  1874,  1876, 
1896  and  1910.  Lack  of  central  agency ;  comparison  of  the  last 
reassessments ;  losses  sustained  in  taxable  basis ;  assessments 
of  each  county  since  1877.  (Diagrams).  Increases;  a  par- 
ticular study  of  the  1910  reassessment  and  cost;  delayed  as- 
sessments ;  occupation  of  the  1910  assessors. 


968' 


4  Contents 

Collection  of  Taxes 217-264 

Changes  in  the  method.  Percentages  of  collection  in  counties. 
Tables ;  levies  and  collections  contrasted ;  methods  and  costs 
of;  discount  system  of  collectors;  code  provisions ;_  rates  or 
fees  paid  in  each  county;  variance  in  dates  of  begirining  of 
fiscal  years;  discount;  interest  and  penalties;  insolvencies;  col- 
lection of  other  revenues. 

Tables  showing  collections  in  each  county  since  1902. 


Taxation  of  Corporations ,  .\ -J  I ,.'..":  .;■.'.' .':V.."..-. . .,  * .  .265-284 

General  view :  Development  of  the  law ;  present  method  of  as- 
sessing shares ;  deductions ;  assessment  of  tangible  property  of 
corporations;  real  estate  and  personal  property;  objections  to 
the  method  of  taxing  shares  instead  of  tangible  assets.  Manu- 
facturing companies.  Receipts.  Bonus  tax :  Foreign  corpora- 
tions ;  annual  franchise  tax ;  entrance  fees ;  gross  receipts  tax ; 
railroad  companies ;  other  transportation  companies ;  freight 
car  and  foreign  fertilizer  companies ;  receipts. 


Taxation  of  Shares  of   Stock  of  Banks.     Other  Financial 

Corporations .285-304 

Method  of  taxation.  Number  of  national  banks  in  Eastern 
States ;  banking  condition  in  Maryland.  Aggregate  resources 
of  the  ten  leading  cities.  Exchange  of  the  Clearing  House  of 
the  ten  leading  cities.  Objections  to  any  charge;  earnings  and 
dividends;  loans  and  discounts.  Taxation  an  important  factor; 
uniformity.  The  1  per  cent,  method  of  other  States ;  deduc- 
tions. Percentage  of  increase  in  capital  and  number  of  de- 
posits of  national  banks.     Compilation  of  tax  methods. 

Trust  companies ;  savings  banks ;  insurance  companies. 


Taxation  of  Intangible  Personal  Property 305-310 

The  Maryland  law.  Classification  for  State  purposes;  secured 
debt  tax  law  of  New  York.  Failure  of  administration.  The 
administration  in  Baltimore  City.  Amounts  assessed  in  each 
county. 


Inheritance  Taxation 311-316 

Changes  in  the  law  of  Maryland ;  table  showing  laws  of  all  other 
States ;  taxation  of  shares  of  Maryland  corporations  belonging 
to  estates  of  non-residents.  Bequest  to  charitable,  educational 
and  religious  institutions. 


Contents  5 

Taxation  of  Stock  and  Bonds  Issued  by  State  and  Local 

Communities   317-332 

General  View :  States  exempting  State  and  municipal  bonds ;  con- 
dition in  Maryland  and  classification  of  taxation  methods ;  tax 
on  Baltimore  City  stock ;  bonded  indebtedness  of  the  State  of 
Maryland,  counties  and  incorporated  cities  and  towns. 

Taxation  of  Mineral  Deposits 333-342 

Coal  basins ;  value  of  annual  output ;  taxation  of  coal ;  classifi- 
cation of  taxation  methods;  suggestion  from  Pennsylvania. 

Taxation  of  Woodlands 343-348 

Wooded  areas;  States  having  special  legislation;  epitome  of  the 
laws  of  other  States. 

Licenses 349-362 

General  view :  State  receipts  from  all ;  traders'  and  receipts ; 
female  traders'.  Inspection  of  stock ;  liquor  and  receipts ; 
State's  share  of.     Motor  vehicle ;  other  licenses  and  receipts. 

School  Taxes 363-374 

Lack  of  system  of  raising  State  and  local  revenues ;  aggregate 
amount  of  and  percentages  of  States'  and  local  contributions  in 
all  States ;  revenue  in  Maryland  since  1903 ;  local  contributions 
and  levies ;  distribution ;  per  capita  cost ;  changes  in  attendance ; 
all  payments  for  taxes  and  repayments  for  schools. 

Cost  of  Government 375-399 

State  government;  classified  receipts  and  expenditures  for  1911 

and  1912. 
Local   government;    assessments,   tax   rates;    return   from^  , 'direct 

taxation,    licenses    and   other   sources;    total    receipts    and  per 

capita  cost. 

Report  on  Accumulation  of  Sinking  Funds 400-426 

State  loans  since  1896.  Debt  at  end  of  each  year;  redemptions 
and  cancellations ;  conditions  of  sinking  funds ;  loans  and  their 
particular  sinking  funds.  Comments ;  comments  as  regard  each 
loan;  per  capita  debt;  percentage  of  sinking  funds  to  total  debt; 
percentage  of  debt  to  assessed  valuation. 

Index "^^r 


INTRODUCTION. 


For  many  years  it  has  been  a  matter  of  common  knowledge 
that  the  general  property  tax  burdens  have  not  been  equally  dis- 
tributed in  Maryland. 

In  response  to  this  general  public  opinion,  the  1912  Legislature 
passed  an  act  (Acts  1912,  chap.  779)  calling  for  the  appointment 
by  the  Governor  of  a  commission  composed  of  six  residents  of  the 
State  of  Maryland,  serving  without  pay,  to  revise  the  revenue  and 
tax  laws  and  review  the  taxation  system  of  the  State  of  Maryland 
and  the  City  of  Baltimore,  including  all  laws,  acts  and  ordinances 
relating  to  the  levy,  assessments  and  collection  of  taxes,  and  every 
form  of  public  revenue  in  the  State  of  Maryland  and  City  of 
Baltimore.  Pursuant  to  this  act,  Governor  Phillips  Lee  Golds- 
borough  appointed  members  of  the  Commission  as  follows  : 

Henry  F.  Baker,  Baltimore  County, 

J.  Barry  Mahool,  Baltimore  City, 

E.  Stanley  Gary,  Baltimore  City, 

J.  H.  Gambrill,  Jr.,  Frederick  County, 

William  M.  Cooper,  Wicomico  County, 

Vernon  Cook,  Baltimore  City. 

The  Commission  first  convened  in  Baltimore  City  on  June  17, 
1912,  and  elected  Henry  F.  Baker  permanent  chairman,  and 
.at  the  second  meeting  the  Commission  selected  Allan  C.  Gird- 
wood,  of  Baltimore  City,  Secretary,  and  engaged  other  expert 
services.  The  Commission  has  had  access  to  all  published  data 
bearing  on  the  subject  of  taxation  in  the  United  States,  and  has 
made  a  special  study  of  the  practical  questions  with  which  the 
Tax  Commissions  of  other  States  have  had  to  deal  and  of  the 
methods  of  treatment. 

In  order  to  come  into  closer  contact  with  the  taxpayers  through- 
out the  State  public  meetings  were  held  in  different  parts  of  the 
State,  notices  having  first  been  published  in  the  local  papers 
inviting  those  interested  in  tax  reform  to  attend  and  present  their 
views. 


8  Report  of  the  Commission 

In  addition  to  these  meetings  and  to  the  thorough  study  of  the 
experiences  of  other  States  in  regard  to  taxation  matters,  the 
Commission  has  availed  itself  of  the  rights  conferred  by  the  act 
to  inquire  thoroughly  into  the  administration  of  tax  matters  by 
State  and  local  tax  officials  throughout  the  State.  Trained  inves- 
tigators were  sent  into  every  county  to  ascertain  the  relation  of 
assessed  valuation  of  real  estate  to  true  value,  as  shown  by  recent 
sales,  and  to  obtain  all  information  possible  on  matters  relating  to 
taxation  and  the  views  of  residents. 

The  data  obtained  in  this  matter  have  been  amplified  by  means 
of  extensive  correspondence  and  by  schedule  forms  filled  in  by 
local  officers.  Specially  prepared  schedules  have  been  sent  to 
County.  Commissioners,  County  Treasurers,  Clerks  of  Circuit 
Courts  and  city  and  village  officials,  and,  by  tabulating  the  replies 
in  these  schedule  forms,  we  have  been  able  to  collect  detailed  finan- 
cial data  and  full  information  in  regard  to  the  local  administration 
of  the  tax  laws,  and  added  to  the  report  is  a  tabulation  of  local 
assessments,  rates,  public  debts  and  matters  never  heretofore  com- 
piled, which  should  prove  of  value  in  contrasting  the  wealth,  debt 
and  method  of  taxation  in  the  different  communities. 

Many  communications  have  been  submitted  to  this  Commission 
by  persons  and  associations  wishing  to  present  their  views  as  to 
the  needs  of  tax  reform,  and  these  also  have  proved  most  valuable 
in  making  our  study. 

On  account  of  the  great  number  of  tax  questions  which  have 
been  presented  for  consideration,  it  has  been  found  impossible  to 
give  consideration  to  all  because  of  the  limited  time  within  which 
the  act  required  the  report  to  be  made,  and  there  have  been 
selected  for  definite  treatment  those  subjects  which  seem  most 
important  and  those  which  relate  to  the  foundation  of  our  tax 
system.  If  the  basic  problems  are  properly  solved,  it  is  believed 
that  most  of  the  other  evils  will  correct  themselves. 

B.M.TiMORE,  Md..  October  15th,  1913. 


REPORT  OF  THE  COMMISSION 

FOR    THE 

REVISION  OF  THE  TAXATION  SYSTEM 

OF   THE 

STATE  OF  MARYLAND 

AND 

CITY  OF  BALTIMORE 

To  the  Honorable  Phillips  Lee  Goldsborough,  Governor, 
and  the  General  Assembly  of  Maryland. 


A  great  many  defects  exist  in  the  present  revenue  system  of 
Maryland.  Changes  have  been  made  from  time  to  time  without 
regard  to  basic  principles,  and  as  a  result  we  have  an  aggregation 
of  detached  units  rather  than  a  comprehensive  system,  and  are 
without  the  continuity  of  centralized  authority  necessary  to 
equalization  of  assessment  and  economical  administration. 

To  attempt  at  once  all  the  changes  necessary  to  perfect  our 
system  would  be  too  revolutionary  and,  therefore,  impracticable. 
In  our  opinion,  revision  of  our  system  of  taxation  should  begin 
with  the  basic  problems,  upon  the  theory  that  if  we  are  able  to 
solve  these  the  other  evils  will  largely  correct  themselves.  The 
most  glaring  inequality  is  the  variation  in  the  ratio  of  assessment 
to  the  true  value  of  property. 

The  assessment  of  property  is  a  business  proposition  and 
should  be  put  upon  a  business  basis.  To  accomplish  this  we 
must  accept  the  most  modern  and  effective  method — control  of 
all  matters  relative  to  taxation  to  be  vested  in  a  State  board. 

Therefore,  while  realizing  the  necessity  for  other  changes  in 
our  system,  we  most  earnestly  recommend  that  first  consideration 
be  given  to  the  creation  of  such  a  central  body  to  supervise  tax 
matters,  with  extensive  powers  as  to  assessment  and  equalization. 

From  our  observation  and  investigation  we  find  the  people  in 
all  parts  of  the  State  united  in  the  opinion  that  most  of  the  defects 
in  our  system  of  taxation  and  collection  are  due  to  a  lack  of  cen- 
tral control. 

9 


10  Report  of  the  Commission 

The  trend  of  opinion  in  this  State  is  not  at  all  in  discord  with 
the  trend  in  many  other  commonwealths.  Recognition  of  the  un- 
scientific and  faulty  assessments  made  by  unsupervised  local 
assessors  has  within  the  last  few  years  caused  the  Legislatures  of 
about  one-half  of  the  States  to  create  permanent  State  Tax  Com- 
missions, each  composed  of  three  or  more  members,  and  to  entrust 
to  those  commissions  the  task  of  supervising  and  reviewing  the 
work  of  the  local  assessors  in  order  to  bring  assessments  more 
nearly  to  a  basis  of  equality.  All  of  these  commissions  have  been 
given  other  important  duties,  but  none  has  been  more  emphasized 
than  that  pertaining  to  supervision  and  correction  of  local  assess- 
ments. 

Permanent  tax  commissions  are  now  in  existence  in  the  fol- 
lowing States.  Most  of  them  have  been  created  in  the  past  five 
years;  five  in  the  present  year,  namely,  in  Nevada,  Montana, 
Idaho,  Florida  and  South  Dakota. 

State.  Title.  Members.         Term. 


Alabama  Tax  Commission 

Arizona Tax  Commission 

Arkansas    Tax  Commission 

Colorado Tax  Commission 

Florida   Tax  Commission 

Idaho    Tax  Commission ! .  . .  . 

Indiana   Tax  Commission 

Kansas   Tax  Commission 

Maine   State  Board  of  Assessors 

Michigan   Tax  Commission 3 

Minnesota    Tax  Commission 

Montana  Tax  Commission 

Nevada   Tax  Commission 

New   Hampshire Tax  Commission ._ 3 

New  Jersey Board  of  Equalization^ 

New    York Tax  Commission 

North   Carolina Tax  Commission 

North  Dakota Tax  Commission 

Ohio    Tax  Commission 

Oregon   Tax  Commission 

Rhode  Island Tax  Commission 

South  Dakota Tax  Commission 

Texas    Tax  Board 

Utah    Board  of  Equalization^... 

Washington    Tax  Commission 

Wisconsin    Tax  Commission 

1  The  three  members  of  the  Public  Utilities  Commission  acting  ex  officio. 

2  Two  ex  officio. 

■^  Five  ex  officio.     The  appointive  member  has  term  of  six  years. 
*  One  ex  officio. 

^  Performs  tax  commission  work. 

6  The  three  members  of  the  Corporation  Commission  acting  ex  officio. 
"^  Three  ex  officio. 
^  One  appointive,  two  ex  officio. 

Note. — Certain  other  States  have  the  office  of  State  Tax  Commissioner 
with  more  or  less  extensive  powers  pertaining  to  taxation. 


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Report  of  the  Commission  11 

The  proposed  tax  commission,  in  our  opinion,  should  be  com- 
posed of  three  members,  all  resident  taxpayers  of  the  State,  to  be 
appointed  by  the  Governor,  one  from  Baltimore  City  and  two 
from  the  counties  of  Maryland,  for  terms  of  six  years  each, 
not  more  than  two  being  of  the  same  political  faith ;  the  first  mem- 
bers, however,  to  be  appointed  for  two,  four  and  six  years  in 
order  to  provide  for  a  continuing  body.  Much  depends  upon  the 
personnel  of  the  commission,  and  the  best  results  could  be  ob- 
tained if  the  members  were  selected  with  regard  to  their  study 
?nd  experience  in  tax  matters,  which  would  especially  fit  them 
for  the  technical  duties  of  the  office. 

We  believe  that  broad  powers  and  duties  should  be  given  to  the 
permanent  tax  commission.  It  should  have  general  supervision 
over  the  administration  of  assessments  and  tax  laws  of  the  State, 
and  it  should  have  the  power  to  direct  and  advise  all  subordinate 
taxing  officials. 

The  Assessment  System. 

In  several  States  there  have  been  created  in  each  county  the 
office  of  county  supervisor  of  assessment,  standing  midway  be- 
tween the  tax  commission  and  the  local  assessors  and  intended  to 
facilitate  the  work  of  both  grades  of  officials.  One  lesson  is  evi- 
dent from  every  source  of  investigation — namely,  the  local 
assessor,  when  left  to  himself,  will  not  meet  the  difficult  require- 
ments of  his  office. 

The  importance  of  the  office  of  assessor  is  seldom  appreciated. 
He  is  chosen  to  administer  a  function  in  which  the  State  as  well 
as  the  locality  should  be  vitally  interested,  as  upon  his  findings 
are  based  very  largely  the  levy  for  revenue  to  pay  the  expense  of 
government.  He  is  called  upon  to  perform  the  double  duty  of 
finding  all  taxable  property  and  assessing  it  at  a  fair  and  just 
valuation.  If  he  conscientiously  carries  out  the  public  trust  that 
is  imposed  upon  him,  the  cost  of  government  is  fairly  and  hon- 
estly distributed  among  those  who  should  be  willing  to  bear  the 
burden,  and  who  under  the  law  are  required  to  bear  it. 

No  assessment  system  is  perfect  in  actual  administration,  and 
as  long  as  human  nature  continues  to  be  as  it  has  been  since  the 
beginning  of  history  we  cannot  hope  that  all  will  be  willing  to 
bear  their  just  share  of  taxes.  It  should,  therefore,  be  the  par- 
ticular endeavor  of  taxing  officials  to  distribute  the  expense  of 


12  Report  of  the  Commission 

government  as  equitably  as  possible,  in  order  that  all  may  share  in 
the  burden  in  proper  proportion  and  so  that  those  who  are 
willing  to  pay  shall  not  have  to  bear  the  added  burden  of  those 
who  seek  to  evade. 

Of  all  the  tax  systems  of  the  different  States,  it  is  perhaps  safe 
to  say  that  the  best  results  have  been  accomplished  in  those  which 
have  inaugurated  the  county  supervisor  of  assessment  system. 
It  is  the  consensus  of  opinion  of  tax  officials  of  the  various  States 
and  of  tax  experts  that  county  supervisors  of  assessment  should 
be  appointed  by  the  state  tax  commission,  in  order  that  the 
supervisor  may  work  in  perfect  harmony  with  the  central  body 
and  effectively  carry  out  its  instructions.  The  county  supervisor 
should  be  given  complete  power  to  represent  the  state  tax  com- 
mission in  his  county.  By  this  method  more  uniform  standards 
of  value  will  be  secured,  and  assessment  of  property  in  general 
throughout  the  State  will  be  equalized. 

We  recommend  that  the  state  tax  commission  shall  select  the 
county  supervisor  from  a  list  of  five  resident  tax  payers,  nomi- 
nated by  the  county  commissioners  of  each  county. 

As  a  rule,  real  estate  values  in  Maryland  have  greatly  increased 
in  the  past  few  years.  Some  farms  which  sold  for  $5,000  a  few 
years  ago  would  sell  readily  today  for  $15,000.  On  the  other 
hand,  some  other  farms  have  not  increased  in  value.  It  is  an 
obvious  fact  that  levies  based  upon  the  values  of  several  years  ago 
are  far  from  equitable  at  the  present  time.  There  was  a  general 
reassessment  in  the  State  in  1910,  but  owing  to  the  fact  that  there 
was  no  consistency  among  the  assessors  as  to  methods  and  re- 
quirements the  result  was  not  uniform. 

Our  laws  make  no  provision  for  the  reassessment  of  real  or 
personal  property  at  regular  intervals,  except  in  Baltimore  City. 
In  comparison  with  the  assessment  provisions  of  most  other 
States,  this  is  a  decided  weakness  in  our  tax  system,  and  the 
Maryland  laws  should  be  so  amended  as  to  provide  for  a  com- 
plete reassessment  of  all  property  at  intervals  of  not  more  than 
five  years,  and  for  yearly  adjustments  of  assessments  so  that  the 
levy  of  each  year  shall  be  based,  so  far  as  possible,  upon  the 
actual  value  of  the  property  taxed.  With  the  county  supervisor 
system  well  installed,  the  added  expense  of  reassessments  would 
be  very  small  and  more  than  offset  by  the  benefits  derived. 


Report  of  the  Commission  13 

The  commission  has  prepared  a  bill  to  create  a  state  tax  comr 
mission  and  to  provide  for  the  appointment  of  county  supervisors 
of  assessments  throughout  the  State. 

Assessment  in  Maryland. 

This  Commission  has  had  investigation  made  of  methods  of 
assessing  property  in  every  county  of  the  State,  and  our  conclu- 
sions are  drawn  from  conditions  as  they  actually  exist.  These 
conditions  are  set  out  in  another  part  of  the  report  and  discussed 
generally,  and  particularly  as  regards  each  county.* 

Some  of  the  striking  conditions  as  they  exist  are  briefly  as 
follows : 

Kent  and  Talbot  Counties  did  not  complete  the  reassessments 
as  required  by  the  Act  of  1910  for  two  years  after  all  other  coun- 
ties had  completed  theirs,  and  these  two  counties  levied  State 
taxes  on  the  old  basis. 

Garrett  and  Cecil  have  not  yet  completed  their  reassessment, 
and  levy  on  the  old  rate.^ 

Every  year  a  few  counties  show  a  loss  of  assessment  for  State 
purposes  and  no  explanation  is  given. 

Frederick  County  paid  for  the  years  between  1878  and  1911 
on  a  basis  less  than  in  1877,  although  its  property  increased 
greatly  in  value. 

The  assessment  of  Talbot  County  was  less  in  1911  than  in  1888. 

Some  properties  in  different  parts  of  the  State  are  assessed  as 
low  as  20  per  cent,  of  their  true  market  value. 

The  following  counties  have  no  assessment  on  securities,  stocks 
and  bonds,  subject  to  the  30-cent  local  rate: 

Worcester, 
Caroline, 
Calvert, 
Garrett. 

Of  a  total  assessment  of  $313,331  for  securities  in  Queen 
Anne's  County,  $257,840  is  assessed  against  one  woman. 


*See  post :  "Assessment  in  Maryland." 

9  See  post :  "Reassessment  in  Maryland,"  referring  to  communication 
of  the  State  Tax  Commissioner  to  this  Commission  (Jan.  17,  1913).  See 
also  report  of  Comptroller  January  1,  1912. 


14  Report  of  tpie  Commission 

In  Queen  Anne's  County  there  is  much  railroad  trackage  not 
assessed. 

Railroad  trackage  is  assessed  at  varying  values  in  adjoining 
counties. 

Of  the  several  railroads  traversing  Washington  County  the 
rolling  stock  of  only  one  is  assessed. 

In  Worcester  County,  in  all  but  two  districts,  land  and  improve- 
ments are  assessed  as  one. 

In  Carroll  County  deposits  in  banks  drawing  interest  are  not 
assessed. 10 

Only  Garrett  County  and  Baltimore  City  assess  churches,  chari- 
table institutions,  etc.,  and  then  abate  the  amount  thereof. 

Dorchester  County  alone  assesses  chickens  throughout  the 
county,  the  assessed  valuation  being  50  cents  each. 

Automobiles  are  not  assessed  in  St.  Mary's  County. 

Calvert  County,'  alone  of  all  the  counties,  systematically  at- 
tempts to  reassess  every  property  at  the  time  of  transfer  and  to 
fix  a  new  valuation  based  upon  the  consideration. 

In  Washington  County,  which  has  an  area  of  457  square  miles, 
the  tax  collector  is  the  only  person  authorized  to  add  new  im- 
provements and  discovered  personal  property  to  the  taxable  basis. 

The  common  practice  is  to  allow  owners  of  large  tracts  an 
abatement  on  account  of  portions  sold  which  is  out  of  all  propor- 
tion. For  instance,  an  owner  of  100  acres,  all  of  the  same  value 
and  assessed  in  the  aggregate  at  $4,000,  may  sell  ten  acres  at  $150 
per  acre  and  be  allowed  an  abatement  on  his  old  assessment 
of  $1,500. 

Notwithstanding  the  natural  increase,  properties  remain  at  the 
same  assessment  between  periods  of  reassessment. ^^ 

Many  cities  and  towns  assess  property  for  local  municipal  pur- 
poses at  a  valuation  which  is  nearer  the  actual  value  than  the 
same  property  is  assessed  for  State  and  county  purposes.  This 
is  brought  about  partly  by  the  fact  that  the  municipalities  have 
had  reassessment  of  their  municipal  territory  at  regular  intervals 
under  the  terms  of  their  charter,  or  special  reassessments  under 
provisions   of   local   acts,   and  the    State   and   county   have   not 


^0  Under  opinion  of  the  Circuit  Court  for  Carroll  County  in  Eck  vs. 
County  Commissioners   (Daily  Record,  Baltimore,  October  26,  1911). 

11  The  interval  between  the  last  two  reassessments  was  fourteen  years. 
See  post:     "Reassessment  in  Maryland." 


Report  of  the  Commission  15 

availed  themselves  of  this  taxable  basis  for  State  and  county 
i:urposes.   ' 

For  instance,  Cumberland  is  assessed  for  local  municipal  pur- 
poses at  $16,098,010,  while  the  State  and  county  assessment  of 
the  same  property  is  approximately  $9,000,000.  Crisfield,  in 
Somerset  County,  is  assessed  for  local  municipal  purposes  at 
$1,618,462,  while  the  entire  election  district,  of  which  Crisfield 
i;  a  small  part,  is  assessed  for  State  and  county  purposes  at 
$1,258,965. 

Numerous  other  instances  of  like  contrast  are  set  out  in  the 
discussion  under  the  assessment  methods  of  the  counties. 

Properties  of  all  kinds  are  frequently  assessed  on  the  individual 
capacity  of  each  owner  to  make  money  out  of  his  particular  prop- 
erty and  without  regard  to  its  actual  worth,  which  in  fact 
amounts  to  a  tax  on  the  ability  of  the  owner. 

In  the  case  of  a  tract  of  land  lying  partly  in  one  county  and 
partly  in  another  county,  the  two  portions  are  often  assessed  quite 
differently,  although  the  real  value  may  be  the  same. 

The  taxable  basis  of  some  counties  represents  80  per  cent,  of 
the  true  value  of  property,  while  in  other  counties  the  taxable 
basis  represents  only  40  per  cent,  of  the  true  value. 

Collection  of  Taxes. 

Much  attention  has  been  given  to  the  administration  governing 
the  collection  of  taxes  in  each  community,  and  we  find  that  the 
methods  are  as  various  as  are  the  assessing  methods  of  the 
counties. 

As  there  are  no  provisions  of  law  for  the  audit  of  books  of 
local  collectors  by  any  State  officers,  and  consequently  no  reports 
published,  we  have  experienced  great  difficulty  in  ascertaining  all 
the  facts.  Books  of  collectors  should  be  audited  by  the  State. 
We  have,  however,  had  special  reports  made  to  us  by  each  County 
Treasurer. 

As  will  appear  from  a  perusal  of  this  subject  treated  elsewhere 
at  length  the  following  facts  are  developed  :* 

That  State  taxes  are  collected  with  local  taxes  and  while  the 
general  law  provides  for  the  time  when  they  are  due  and  payable, 


"See  post :  "Collection  of  Taxes." 


16  Report  of  the  Commission 

there  are  local  laws  providing  for  the  payment  of  local  taxes 
which  control  the  collection. 

That  the  date  when  local  taxes  are  due  and  payable  varies  in 
each  county. 

That  the  charge  against  collection  of  State  taxes  is  vastly  in 
excess  of  the  charge  against  the  collection  of  the  local  taxes,  al- 
though the  amount  of  local  taxes  collected  is  many  times  the 
amount  of  State  taxes  collected;  State  taxes,  however,  are  not 
subject  to  any  commission  against  the  State  for  collection. 

That  in  many  counties,  local  collectors  advance  to  the  State  an 
amount  which  they  estimate  may  be  collected  and  make  for  them- 
selves the  amount  of  the  discount  allowed  by  the  State. 

That  in  Carroll  County  there  are  fourteen  collectors  of  State 
taxes. 

In  Allegany  County  and  Worcester  County  there  are  three 
collectors. 

Dorchester  County  has  seventeen  collectors  who  report  to  the 
County  Treasurer  the  amount  of  State  taxes,  who,  in  turn,  reports 
to  the  State  Comptroller  for  State  taxes. 

In  each  of  the  others,  there  is  but  one  collector. 

That  Caroline  and  Cecil  Counties  reported  collection  of  no  cur- 
rent State  taxes  to  the  first  of  October  in  1912. 

Some  counties  are  very  lax  in  remitting  back  taxes,  and,  from 
the  Comptroller's  report,  it  would  appear  that  none  are  collected. 

The  following  table  shows  the  percentage  of  collection  of  cur- 
rent taxes  for  the  year  1912: 

Percentage  of  Percentage  of 

Counties.  Collection.*  Counties.  Collection. 

Allegany 0.64  Howard 0.40 

Anne  Arundel 54  Kent 86 

Baltimore  City 79  Miontgomery 54 

Baltimore  County 61  Prince  George's 40 

Calvert 95  Queen  Anne's 14 

Caroline ; 00  St.  Mary's 89 

Carroll 80  Somerset 08 

Cecil 00  Talbot 63 

Charles 59  Washington 65 

Dorchester 32  Wicomico 87 

Frederick 95  Worcester 55 

Garrett 47  

Harford 61  The  State 69 


"Note. — State  allows  5  per  cent,  discount. 


Report  of  the  Commission  17 

Other  Revenues. 

Criticism  of  collection  methods  apply  to  collection  of  taxes 
from  corporations,  and  also  to  collection  and  accounts  of  fee  of- 
ficers, such  as  Clerks  of  Courts,  Sheriffs,  Registers  of  Wills  and 
States'  Attorneys. 

Maryland  does  not  charge  each  county  with  an  amount  to  be 
paid  by  that  political  unit,  but  levies  on  the  taxable  basis  of  each 
property  a  rate  or  the  annual  State  tax.  As  explained  in  detail, 
this  does  not  net  the  State  the  amount  of  taxes  due,  and  there 
are  some  taxes  that  are  never  collected. 

The  entire  question  of  collection  is  a  large  one,  and  the  present 
methods  far  from  satisfactory.  For  this  reason  the  commis- 
sion recommends  that  the  state  tax  commission  should  be  em- 
powered to  create  a  department  of  audits  and  accounts  in  order 
to  devise  a  uniform  system,  both  of  keeping  assessment  and  col- 
lection books,  and  to  work  in  conjunction  with  the  Comptroller 
of  the  State. 

The  proper  collection  of  taxes  means  much  to  the  State,  and  it 
seems  advisable  that  all  taxes  should  be  a  preferred  claim  in  the 
event  that  the  person  assessed  is  adjudged  a  bankrupt. 

Taxation  of  Corporations.* 

Under  the  present  law  domestic  corporations,  except  steam 
railroad  companies,  are  taxed  through  assessments  on  the  valua- 
tion of  their  shares  of  stock  ascertained  by  the  State  Tax  Com- 
missioner from  annual  reports  filed  by  corporations  with  this 
officer,  setting  forth  all  such  information  as  may  be  desired  by 
him.  Upon  such  valuation  of  the  shares,  the  State  tax  is  paid 
directly  by  the  corporation  which  has  a  right  to  retain  the  amount 
thereof  from  the  dividends  due  the  stockholders,  and  the  full 
local  tax  is  paid  to  the  several  taxing  authorities  in  those  com- 
nmnities  in  which  the  stockholders  reside.  There  are  no  allow- 
ances for  the  value  of  shares  held  by  non-residents  either  for 
State  or  local  taxes. 

The  law  provides  that  in  no  case  shall  the  aggregate  value 
of  the  shares  of  stock  be  less  than  the  combined  value  of  real 
and  personal  property  of  the  corporation.     The  real  estate  of 


*See  post :  "Taxation  of  Corporations." 


18  Report  of  the  Commission 

every  corporation  is  assessed  locally,*  and  a  certificate  furnished 
to  the  proper  officer  to  be  forwarded  to  the  State  Tax  Commis- 
sioner. The  tax  on  the  real  estate  is  paid  exactly  like  the  tax  on 
the  real  estate  of  an  individual,  and  the  State  Tax  Commissioner 
deducts  the  amount  of  the  assessment  thereof  together  with 
other  securities  and  other  tax-paying  shares  before  determining 
the  net  assessment  of  shares  of  stock. 

But  as  regards  personal  property  of  corporations,  there  is  no 
assessment  made  by  local  assessors,  and  the  State  Tax  Commis- 
sioner has  no  guide  to  aid  him  in  valuing  this  class  of  property. 
It  is  an  impossible  task  for  the  State  Tax  Commissioner  to  prop- 
erly value  the  personal  property  of  3,497  corporations,  even  if  the 
reports  ever  set  out  the  same  in  detail,  and  in  practice  it  may  be 
said  that  every  corporation  in  Maryland  determines  for  itself 
the  value  of  its  personal  property  for  purposes  of  taxation. 
Some  officials  of  corporations  are  thoroughly  conscientious  in 
making  their  returns,  including  the  amount  of  the  personal  prop- 
erty held  by  corporations,  but  our  investigation  has  shown  that 
there  are  enormous  amounts  of  personal  property  of  Maryland 
corporations  which  are  now  not  paying  any  State  and  local  taxes. 

There  can  be  no  difference  between  the  value  of  stock  in  trade 
of  a  merchant  and  the  identical  property  if  owned  by  a  corpora- 
tion trading  as  a  merchant,  and  it  seems  that  the  assessment  of 
the  two  should  be  alike  for  like  property,  and  neither  should  be 
allowed  to  value  their  property  for  purpose  of  taxation. 

The  actual  or  exchange  value  of  shares  of  stock  of  corporations 
is  not  dependent  entirely  upon  the  value  of  the  tangible  property 
of  the  corporation. 

Many  elements  of  an  intangible  nature,  such  as  good  will, 
ability  of  management,  dividend-earning  capacity,  etc.,  in  reality 
determine  such  value,  and  it  is  impossible  for  any  tax  authori- 
ties to  properly  assess  such  elements  in  conjunction  with  owner- 
ship of  real  and  personal  property  without  penalizing  individual 
ability  and  industry.  It  may  be  safely  said  that  the  corporate  ex- 
cess is  assessed  against  a  negligible  number  of  corporations,  and 
that  a  great  majority  of  corporations  have  never  paid  on  these 
uncertain  elements. 


*NoTE. — See  post — the  discussion  of  the  case  of  the  M.  &  C.  C.  of  Cum- 
berland vs.  National  Bank  (Circuit  Court  for  Allegany  County)  ;  opinion 
of  Boyd,  C.  J.,  page  270. 


Report  of  the  Commission  19 

Injustice  also  is  done  under  the  present  method  of  corporate 
excess  taxation  to  those  corporations  which  return  their  volume 
of  business  and  possible  secrets  of  trade,  while  in  any  business 
of  like  kind  conducted  by  an  individual  these  elements  are  not 
considered  in  arriving  at  values.  A  full  compliance  with  the 
present  law  would  be  extremely  inquisitorial,  and  is  impossible 
of  enforcement. 

Our  investigation  throughout  the  counties  has  shown  a  lack  of 
knowledge  on  the  part  of  local  assessing  officers  and  taxing  of- 
ficials, in  regards  to  the  assessment  of  personal  property  of  corpo- 
rations. The  law  contemplates  that  the  value  of  the  personal 
property  as  valued  by  the  State  Tax  Commissioner  shall  be  re- 
flected in  the  shares.  The  provisions  of  the  law  are  not  clearly 
understood,  and  the  impression  is  general  that  corporations  are 
not  assessed  for  this  class  of  property.  The  local  idea,  which  is 
v.-ell  founded,  is  that  the  protection  of  personal  property  from 
fire  and  police  is  a  proper  local  charge,  as  its  safety  depends  upon 
local  care,  and  in  protecting  the  personal  property  the  shares  are 
properly  protected. 

This  Commission,  therefore,  after  a  thorough  study  and  ex- 
haustive examination,  can  find  no  excuse  for  a  further  continu- 
ance of  the  present  method  of  taxing  shares  of  business  corpora- 
tions. 

In  1902^-  there  was  a  Commission  appointed  on  the  part  of  the 
Legislature  to  revise  the  corporation  laws  of  Maryland,  and  that 
Commission  recommended  that  corporations  should  be  required 
to  pay  taxes  on  their  real  and  personal  property  as  individuals, 
and  in  addition  that  each  corporation  should  be  required  to  pay  a 
franchise  tax  based  on  the  amount  of  its  capital.  The  rates  fixed 
were  to  be  identical  with  those  of  a  foreign  corporation,  $25  for 
every  full  $50,000  of  capital  up  to  $500,000,  but  in  no  case  less 
than  $25.  If  the  amount  of  the  capital  is  more  than  $500,000 
and  not  more  than  $5,000,000,  an  additional  amount  of  1/40  of 
1  per  cent,  on  the  excess,  and  if  the  amount  of  such  capital  is 
more  than  $5,000,000,  an  additional  amount  of  $30  on  every  mil- 
lion dollars  of  last  named  excess. 

The  important  question  of  taxation  of  ordinary  business  corpo- 
rations should  receive  most  serious  consideration  by  the  Legisla- 


12  Acts  1902,  ch    446.  . 


20  Report  of  the  Commission 

ture,  and,  in  our  opinion,  the  general  plan  as  outlined  by  the  Com- 
mission of  1902  should  be  adopted. 

Taxation  of  Manufacturing  Corporations. 

The  present  laws  controlling  the  taxation  of  business  cor- 
porations fall  with  peculiar  force  upon  manufacturing  corpora- 
tions and  have  resulted  both  in  keeping  out  the  investment  of 
foreign  manufacturing  capital,  and  curtailing  the  investment 
of  Maryland  capital  in  manufacturing  corporations  located 
within  the  State.  In  view  of  the  importance  of  manufacturing 
to  the  State  this  condition  of  affairs  is  most  unfortunate. 
There  is  a  very  close  relation  between  the  increase  of  manu- 
facturing capital  and  the  increase  of  values  in  real  and  per- 
sonal property.  Additions  to  manufacturing  capital  result  not 
only  in  general  benefits  to  the  State  as  a  whole,  but  also  have 
an  important  and  direct  influence  on  the  taxable  basis.  The 
value  of  a  new  factory  which  provides  employment  for  several 
hundred  men  can  in  no  way  be  limited  to  the  money  cost  of 
the  factory  itself.  It  is  self-evident  that  the  values  created  by 
manufacturing  enterprises  are  of  greater  consequence  than  are 
the  actual  values  of  the  manufacturing  plants  themselves. 

In  contrast  with  the  liberal  provisions  regarding  the  taxa- 
tion of  manufacturing  corporations  in  neighboring  States, 
Maryland  has  maintained  an  unenviable  and  short-sighted 
policy  which  has  steadily  disregarded  the  fact  that  a  high  tax 
rate  often  yields  a  small  relative  return.  Manufacturing  cor- 
porations which  should  properly  be  located  in  Maryland  have, 
in  order  to  avoid  the  handicap  resulting  from  excessive  and 
inquisitorial  tax  burdens,  been  forced  to  incorporate  in  other 
States,  which  latter  States  have  received  the  large  benefits 
directly  accruing  from  the  resulting  increase  in  their  aggregate 
wealth.  This  contrast  was  clearly  summarized  by  the  United 
States  Bureau  of  Corporations  when,  in  a  report  on  the  taxa- 
tion of  corporations  in  the  Middle  Atlantic  States,  it  said : 
"Manufacturing  is  favored;  such  companies  are  exempt  from 
taxation  in  Pennsylvania  and  also  in  New  York,  New  Jersey 
and  Delaware,  if  conducting  their  business  chiefly  within  the 
State.      In  Maryland  they  are  subject  to  the  capital  stock  tax."* 

*Taxation  of  Corporations  (U.  S.  Bureau  of  Corporations,  Part  II). 


Report  of  the  Commission  21 

We  do  not  wish  to  be  understood  as  recommending  any 
specific  privileges  and  exemptions  which  should  be  accorded 
to  Maryland  manufacturing  corporations,  but  we  do  urge  that 
they  be  treated  as  liberally  and  equitably  as  are  similar  manu- 
facturing corporations  in  competing  States.  We  believe  that 
the  passage  of  the  law  which  we  have  referred  to  in  regard  to 
business  corporations  will  place  manufacturing  corporations 
much  more  nearly  on  a  basis  of  fair  competition  with  the 
manufacturng  corporations  of  sister  States  than  is  the  con- 
dition at  the  present  time. 

Bonus  Tax. 

W'e  think  that  the  bonus  tax  of  1/8  of  1  per  cent,  now  im- 
posed by  the  laws  of  Maryland  is  too  high,  and  tends  to  force 
our  citizens  to  incorporate  in  other  States. 

We  favor  a  reduction  in  this  tax  so  that  it  may  more  nearly 
equal  the  bonus  tax  of  our  sister  States. 

Gross  Receipts  Tax. 

This  Commission  has  not  had  facilities  to  audit  the  returns  of 
corporations  subject  to  the  gross  receipts  tax,  and  we  earnestly 
suggest  that  this  subject  should  be  thoroughly  investigated. 
Gross  receipts  have  shown  but  little  change. 

Several  corporations  return  statements  showing  an  identical 
amount  of  receipts  for  succeeding  years.  We  believe  that  these 
returns  cannot  be  correct. 

When  the  tax  against  these  corporations  was  fixed  at  2  per 
cent.,  these  corporations  paid  the  same  amount  of  tax  to  the  State 
which  they  now  pay  on  a  2%  per  cent.  rate. 

Freight  Car  Companies. 


The  assets  of  freight  car  companies  consist  chiefly  of  their 
cars  and  the  right  to  run  over  the  tracks  of  certain  railroads. 
These  companies  are  in  most  cases  foreign  corporations. 

From  the  report  of  the  State  Tax  Commissioner,  these  freight 
car  companies  are  not  listed  separately  for  taxation  upon  their 
gross  receipts.  While  the  revenue  from  a  State  gross  receipts 
tax  on  freight  car  companies  at  a  reasonable  rate  would  not  ag- 


22  Report  of  the  Commission 

gregate  a  large  sum,  such  a  tax  would,  if  properly  administered, 
produce  sufficient  State  revenue  to  be  worthy  of  consideration. 

Taxation  of  Foreign 
Corporations. 

Under  the  present  law,  foreign  corporations  doing  business  in 
this  State  are  taxed  upon  all  their  real  and  personal  property 
located  in  this  State,  and  in  addition  thereto  are  required  to  pay 
a  franchise  tax  of  $25  on  every  full  $50,000  of  capital  employed 
in  this  State  up  to  $500,000,  but  in  no  case  less  than  $25.  If  the 
amount  of  such  capital  is  more  than  $500,000  and  not  more  than 
$5,000,000,  then  an  additional  amount  equal  to  one-fortieth  of 
1  per  cent,  on  the  excess;  and  if  more  than  $5,000,000,  another 
additional  amount  at  the  rate  of  $30  for  every  million  dollars  of 
such  last-named  excess  must  be  paid.  The  shares  of  stock  of  such 
corporations  in  the  hands  of  a  Maryland  owner  are  also  sub- 
jected, provided  dividends  are  paid  on  such  stock,  to  the  full 
amount  of  State  taxation  and  to  a  30-cent  rate  for  county  or  city 
taxes. 

By  way  of  contrast  to  the  above,  it  must  be  remembered  that 
the  shares  of  stock  of  a  Maryland  corporation  are  taxed  at  the 
full  State  and  city  or  county  rates,  the  city  or  county  rates  being 
always  much  higher  than  the  30-cent  rate  applied  to  the  stock  of 
foreign  corporations. 

The  result  of  the  above  has  been  that  in  hundreds  of  cases  citi- 
zens of  Maryland  desiring  to  form  a  corporation  for  business 
wholly  or  mainly  in  this  State  have  been  driven  to  the  expedient 
of  incorporating  in  a  foreign  State  in  order  to  get  the  benefit  of 
the  lower  taxation  to  which  foreign  corporations  have  heretofore 
been  subjected,  the  result  being  that  many  corporations  which 
normally  would  have  been  formed  here  have  in  fact  been  formed 
elsewhere,  and  their  franchise  taxes,  which  normally  would  have 
passed  into  the  treasury  of  this  State,  have  as  a  matter  of  fact 
passed  to  the  treasuries  of  our  sister  States. 

The  most  important  change  needed  to  remedy  this  condition 
is  the  suggested  method  of  taxing  Maryland  corporations 
treated  in  another  part  of  this  report.  In  addition  to  that 
change,  and  in  order  if  possible  to  induce  citizens  of  Maryland 
who  have  heretofore  incorporated  in  other  States  and  whose  main 


Report  of  the  Commission  23 

business  is  located  here  to  re-incorporate  in  Maryland,  where  they 
rightfully  belong,  we  suggest  that  the  franchise  tax  on  a  foreign 
corporation,  which  is  now  identically  the  same  as  that  proposed 
to  be  placed  upon  Maryland  corporations,  referred  to  in  another 
portion  of  this  report,  should  be  made  double  the  present  amount. 
The  object  of  this  is  to  encourage  the  incorporation  of  Maryland 
concerns  in  the  State  of  Maryland. 

It  must  be  remembered,  however,  that  foreign  corporations  are 
of  two  kinds:  First,  those  which  are  really  foreign  concerns — 
that  is  to  say,  concerns  whose  main  business  is  in  another  State, 
but  which  maintain  a  branch  business  here;  second,  foreign  cor- 
porations (sometimes  known  as  tramp  corporations)  which  are 
really  Maryland  concerns  in  the  sense  that  their  main  office  and 
business  is  located  here,  but  which,  on  account  of  taxation  or 
because  in  some  other  respect  the  laws  of  other  States  have  been 
deemed  more  favorable  than  the  laws  of  Maryland,  have  been 
irjcorporated  elsewhere.  As  to  corporations  of  the  first  class  men- 
tioned— that  is,  the  true  foreign  corporation,  having,  say,  more 
than  50  per  cent,  invested  outside  of  the  State — we  see  no  reason 
for  increasing  the  present  tax;  but  corporations  of  the  second 
class  described  are  not  to  be  encouraged,  and,  with  a  view  to 
bringing  as  many  such  corporations  as  possible  back  to  our  own 
State,  we  suggest  that  the  franchise  tax  on  such  corporations  be 
made  double  the  franchise  tax  on  domestic  corporations. 

Foreign  Fertilizer  Corporations. 

The  present  Maryland  law  places  foreign  fertilizer  companies 
in  a  class  with  public  service  corporations,  and  requires  them  to 
pay  a  tax  based  upon  their  gross  receipts.  This  manner  of  taxing 
foreign  fertilizer  corporations  is  different  from  the  manner  of 
taxing  other  foreign  corporations,  and  the  Commission  sees  no 
reason  why  there  should  be  a  difference  in  taxing  foreign  fertil- 
izer companies  from  any  other  foreign  corporations,  or  any  dif- 
ference in  taxing  them  from  domestic  fertilizer  companies. 


24  Report  of  the  Commission 

Taxation  of  Shares  of  Stock  of 
Banks  and  Other  Financial 
Corporations. 

A  very  earnest  appeal  has  been  made  to  this  Commission  by 
the  representatives  of  banking  interests  for  reUef  from  what  is 
claimed  by  them  to  be  a  heavy  and  unreasonable  burden  now 
imposed  by  the  present  system  of  bank  taxation. 

Banks  are  taxed  under  the  existing  law  upon  the  value  of 
their  shares  of  capital  stock  as  ascertained  by  the  State  Tax  Com- 
missioner, who  proceeds  in  the  same  manner  in  assessing  shares 
of  banks  as  in  the  case  of  shares  of  other  corporations.  The 
difference  in  the  practical  operation  of  the  law  seems  to  be  that 
the  assets  of  a  great  majority  of  corporations  consist  of  property 
of  more  or  less  uncertain  value,  and  the  State  Tax  Commissioner 
can,  therefore,  exercise  a  certain  liberality  in  making  his  valua- 
tion. In  the  case,  however,  of  banks  the  assets  consist  of  cash 
.  and  credits  of  a  fixed  and  definite  value,  and  the  result  is  that  a 
rigorous  enforcement  of  the  present  law  means  that  such  insti- 
tutions are  assessed  up  to  the  full  value  of  their  assets. 

The  banks  claim  that  the  tax  under  this  system,  amounting,  as 
it  does,  for  example,  in  Baltimore  City  at  the  present  time  to 
2.32  per  cent.,  is  an  unreasonable  burden  to  be  placed  upon  the 
banking  business,  and  in  support  of  this  contention  they  have 
submitted  to  the  Commission  numerous  figures  showing  that  in 
other  States  and  cities  banking  capital  is  subjected  to  no  such 
burden.  It  is  contended,  therefore,  that  the  law  hampers  the 
development  of  this  necessary  business. 

In  another  part  of  this  report*  is  set  out  the  ratio  of  earnings 
of  national  banks  to  capital  and  surplus,  and  also  the  ratio  of 
dividends  to  capital  and  surplus  of  the  ten  largest  cities  in  the 
United  States.  Examination  of  these  tables  places  :Maryland 
banks  in  an  unfavorable  class. 

Elsewhere  in  this  report  also  will  be  found  the  change  in 
amount  of  capital  of  Maryland  banks  within  the  last  ten  years, 
and  this  shows  that  in  ten  years  the  capital  of  national  banks 
increased  from  $17,050,000  to  $17,607,000,  while  in  Baltimore 
there  has  been  a  change  of  capital  in  ten  years  from  $12,403,260 


*See  post :  "Taxation  of  Shares  of  Stock  of  Banks  and  Other  Financial 
Corporations." 


Report  of  the  Commission  25 

in  1903  to  $11,790,710  in  1913.  In  the  corresponding  periods  in 
States  adjoining  Maryland  there  have  been  large  increases  in 
capital.  The  Commission  has  had  brought  to  its  attention  the 
consolidation  in  1912  (1st  January,  1913)  of  the  Merchants' 
National  Bank,  which  prior  to  consolidation  had  a  capital  of 
$1,500,000  and  a  surplus  of  $900,000,  with  the  Mechanics'  Na- 
tional Bank,  with  $1,000,000  capital  and  $1,000,000  surplus,  into 
the  Merchants-Mechanics'  National  Bank,  which  has  a  capital  of 
$2,000,000  and  a  surplus  of  $2,000,000.  The  result  of  the  merger 
is  a  net  loss  of  $400,000  in  available  banking  capital  and  the  tax- 
able basis. 

Bearing  in  mind  the  exemption  allowed  for  real  estate  and 
exemptions  of  certain  designated  securities  in  the  cities  referred 
to  and  discussed  fully  in  another  part,  a  bank  having  $1,000,000 
capital  and  $1,000,000  surplus  in  the  following  cities  would  pay 
in  1913  the  amount  of  taxes  set  forth:* 

Baltimore   Citv $46,400  00 

Boston   32,800  00 

Chicago   29,332  00 

Cleveland 27,200  00 

St.  Louis 22,200  00 

New  York 20,000  00 

Philadelphia 8,000  00 

Pittsburgh  8,000  00 

*NOTE. 

The  following  deductionst  are  allowed : 

Baltimore :  Real  estate  and  net  assessment  of  shares  of  other  Mary- 
land banks  and  corporations  ; 
Certain   issues   of   Baltimore   City   stock    (but  only   shares   taxable   in 
Baltimore  City)  ;    (Shares  are  taxable  against  the  holder,  wherever 
he  resides). 
Boston.:  Real  estate. 
Chicago :  Real  estate. 
Cleveland :  Real  estate. 
St.  Louis :  Real  estate. 
New  York :  None. 
Philadelphia :   None. 
Pittsburgh  :  None. 
"(■Compiled  from  Report  of  Horace  E.  Flack,  Municipal  Journal,  Baltimore, 
August  29th,  1913. 


26  Report  of  the  Commission 

It  is  undoubtedly  true  that  the  city  and  State  do  not  have  as 
large  a  banking  capital  as  could  be  desired,  and  the  amount  of 
banking  capital  is  not  showing  a  healthy  and  proper  increase. 

The  question  of  bank  taxation  is  a  special  field  which  requires 
and  deserves  special  study  and  consideration. 

If  the  expenses  of  the  local  banks  are  heavy  as  compared  with 
those  of  banks  in  neighboring  States,  it  stands  to  reason  that  the 
local  banks  cannot  compete  with  banks  in  other  States  and 
offer  the  same  inducement  to  depositors.  As  Baltimore  is  a 
reserve  city,  this  deserves  consideration. 

As  indicated  in  another  portion  of  this  report,  we  have  found 
it  impossible  to  investigate  fully  all  the  special  subjects  relating 
to  taxation,  and  have  thought  it  best  to  confine  our  recommenda- 
tions to  a  few  of  the  most  vital  and  fundamental  points.  We, 
therefore,  make  no  recommendation  on  the  subject  of  bank  taxa- 
tion, except  to  say  that  we  do  feel  that  our  banks  are  at  present 
subjected  to  a  heavy  burden  of  taxation,  and  that  under  all  the 
circumstances  they  are  entitled  to  some  relief.  They  should,  if 
possible,  be  placed  on  a  basis  where  their  rate  of  taxes  will  more 
nearly  correspond  to  that  which  is  imposed  on  similar  com- 
petitive institutions  in  neighboring  States.  The  exact  measure  of 
relief  and  the  details  of  necessary  legislation  must  be  left  to  the 
judgment  of  the  Legislature. 

Savings  Bank  Deposits. 

The  law  of  Maryland  provides  that  savings  banks  shall  pay  a 
tax  or  annual  franchise  charge  of  25  cents  on  each  $100  of  de- 
posits, three-fourths  of  which  shall  be  paid  to  the  local  community 
in  which  the  bank  is  located. 

There  has  been  no  attempt  to  verify  the  actual  deposits  with 
the  aggregate  deposits  as  returned  to  the  State  Tax  Commis- 
sioner for  taxation,  but  in  another  part  there  is  a  compilation 
showing  the  aggregate  amount  of  deposits  in  each  county  of  the 
State. 

In  many  counties  no  saving  deposits  are  returned,  and  in  some 
of  these,  if  not  all,  there  are  savings  institutions  and  deposits. 

The  method  of  imposing  a  franchise  on  deposits  seems  satis- 
factory. 

This  Commission  has  found  that  depositors  were  assessed  in 
Carroll  County  the  amount  of  their  deposits  under  the  1910  re- 


Report  of  the  Commission  27 

assessment.  Following,  however,  the  decision  of  the  Circuit 
Court  for  Carroll  County  in  Eck  vs.  County  Commissioners, 
which  held  that  these  were  not  properly  taxable  under  the  security 
rate,  the  assessments  were  abated.  Our  investigation  shows  that 
in  a  few  communities  there  is  some  attempt  to  assess  deposits. 

The  policy  of  the  State  should  be  uniform,  and  if  deposits  are 
taxed  in  one  community  they  should  be  taxed  in  all ;  if  exempt  in 
one,  they  should  be  exempt  in  all. 

Tax  on  Insurance  Companies. 

The  Maryland  law  provides  that  foreign  life  insurance  com- 
panies shall  be  required  to  pay  annually  a  license  fee  of  $300, 
and  all  other  foreign  insurance  companies  a  fee  of  $100  an- 
nually.* 

In  addition,  foreign  fire,  marine  and  inland  insurance  com- 
panies pay  a  premium  of  2  per  cent,  on  the  amount  of  premiums 
collected  in  the  State,  less  deduction  for  re-insurance  and  can- 
cellations; life  and  casualty  companies,  1^  per  cent.  The  rate 
in  many  States  is  uniform  for  all  companies  at  2  per  cent.  Mary- 
land requires  in  addition  an  annual  fee  of  $10  from  each  agent 
of  such  foreign  company.  In  some  other  States  this  agent's  fee 
of  $10  is  imposed  only  against  corporations  of  those  States  which 
impose  a  similar  fee,  and  this  retaliatory  measure  works  to  the 
disadvantage  of  some  Maryland  corporations. 

Domestic  companies  pay  a  gross  receipts  tax. 

Taxation  of  Intangible  Personal  Property. 

Maryland  taxes  the  stock  of  domestic  corporations,  as  ex- 
plained before,  differently  from  the  stock  of  foreign  corporations, 
and  our  discussion  here  refers  only  to  the  corporate  bonds  and 
certificates  of  indebtedness  of  all  corporations  and  the  stocks  of 
foreign  corporations  now  taxed  under  Article  81,  Section  214,  at  ^ 
the  full  State  rate  and  a  uniform  local  rate  of  30  cents.  We 
realize  that  this  method  of  classification  and  the  imposition  of 
the  30-cent  local  rate  has  been  the  subject  of  favorable  comment 
by  students  of  taxation,  and  many  reports  have  cited  this  State 
as  an  example  of  a  low  rate  producing  more  revenue  than  a  high 


*See  Acts  of  1912,  ch.  207. 


28  Report  of  the  Commission 

rate  by  reason  of  the  fact  that  a  greater  assessment  is  thereby 
obtained.  This  conclusion  is  correct  only  in  part.  When  this 
class  of  property  was  taxed  the  full  local  rate  (prior  to  1896), 
Baltimore  City  had  $6,000,000  assessed,  whereas  it  now  has 
$179,412,676  on  the  books.  The  result  throughout  the  State 
has  not  shown  anything  like  this  change.  Even  now  but  a  small 
part  of  this  kind  of  property  is  assessed  in  Baltimore  City,  and 
less  in  the  counties.  The  amount  of  securities  taxed  in  each 
county  is  shown  in  a  table  in  another  part  of  this  report.*  Four 
counties  of  the  State — namely,  Calvert,  Caroline,  Garrett  and 
Worcester — have  not  a  single  assessment  against  this  class  of 
property. 

It  is  a  well-known  fact  that  a  large  part  of  the  wealth  of  our 
people  at  the  present  time  consists  of  securities  subject  to  this  rate 
of  taxation,  and  there  is  no  doubt  that  in  every  community  a 
vast  amount  of  this  class  of  property  escapes  taxation. 

To  tax  intangible  personal  property  at  the  full  rate  of  taxation 
would  amount  to  confiscation.  To  abolish  the  tax  altogether  upon 
the  theory  that  the  taxes  are  paid  on  tangible  property,  which 
give  the  securities  their  value,  the  holder  being  thus  subjected  to 
a  double  tax,  is  not  feasible  or  practical,  in  view  of  the  fact  that 
there  is  property  in  such  shares.  This  class  of  property  is  hard 
to  find  for  purposes  of  taxation,  and  the  problem  of  reaching  it 
is  giving  authorities  everywhere  great  difficulty.  There  is  every- 
where a  natural  aversion  to  paying  taxes  on  stocks  and  bonds, 
and  many  securities  do  not  get  on  the  tax  books  until  the  death 
of  the  owner  discloses  their  ownership.  In  1908  the  "Advisory 
Committee  on  Taxation  and  Revenue  submitted  to  the  Mayor 
of  Baltimore"  reported  that  there  were  then  3,300  accounts  on 
the  tax  books  of  Baltimore  for  securities.  Of  these  8  accounts 
were  corporations  returning  $52,408,092;  211  accounts  of  trust 
estates  returning  $26,906,838,  and  only  2,281  individuals  return- 
ing $67,373,927.  We  understand  that  there  is  no  material  change 
in  the  above  ratio. 

The  present  method  of  taxing  securities  and  the  administration 
of  the  law  places  a  premium  upon  fraud  and  perjury  and  a 
penalty  upon  truth  and  honesty.  No  one  can  defend  this  situa- 
tion.   The  law  should  be  amended  so  as  to  reverse  this  state  of 


'''See  post :  "Taxation  of  Intangible  Personal  Property." 


Report  of  the  Commission  29 

affairs  and  place  the  penalty  where  it  belongs,  on  the  one  who 
seeks  to  evade  taxation,  and  to  give  the  premium  to  the  one  who 
honestly  and  fairly  makes  his  return. 

We  believe  that  the  solution  of  this  condition  is  to  be  found 
along  the  lines  of  a  statute  which  has  been  in  force  for  some 
years  in  the  State  of  Connecticut.  The  scheme  of  this  statute 
is  to  impose  relatively  a  low  rate  of  taxation  on  all  securities 
which  are  voluntarily  reported  for  taxation,  and  a  very  much 
higher  rate  on  all  such  securities  as  are  not  voluntarily  reported. 
In  the  State  named,  securities  voluntarily  reported  pay  a  rate  of 
40  cents  on  the  $100.  Those  not  voluntarily  reported  pay  rates 
varying  somewhat  in  different  localities,  but  averaging  about  $2.20 
per  $100. 

The  fundamental  idea  is  to  make  it  pay  the  security-holder 
to  make  a  truthful  return  of  his  securities. 

The  Commission  recommends  that  the  present  law  of  Mary- 
land be  amended  in  order  to  accomplish  this  same  general  pur- 
pose, but  not,  however,  in  the  same  way.  It  seems  to  us  that  the 
law  should  be  modified  in  the  following  manner: 

1.  All  persons  who  voluntarily  report  their  securities  for  tax- 
ation, and  pay  the  tax  thereon  within  the  time  fixed  by  law,  shall 
be  entitled  to  a  discount  of  50  per  cent,  on  the  State  taxes,  and 
also  on  the  local  taxes  of  30  cents. 

2.  All  securities  which  are  hereafter  placed  upon  the  tax  books 
as  a  result  of  the  inquiries  or  investigation  of  the  taxing  authori- 
ties, or  any  notice  or  summons  sent  out  by  them,  shall  be  sub- 
jected to  the  State  taxes  and  local  taxes  of  30  cents,  and  in  ad- 
dition to  a  penalty  of  50  per  cent,  for  such  year. 

3.  All  securities  now  on  the  assessment  books  shall  be  treated 
as  though  voluntarily  returned,  and  the  owner  shall  be  entitled 
to  the  50  per  cent,  discount  if  the  tax  is  paid  within  the  time  fixed 
by  law. 

4.  Upon  the  death  of  any  owner  of  securities,  it  shall  be 
prima  facie  presumed  that  all  securities  belonging  to  his  estate 
and  not  assessed  against  him  in  his  lifetime  were  owned  by  him 
for  a  period  of  five  years  immediately  prior  to  his  death,  and  the 
State  and  local  taxes,  with  the  penalty  above  mentioned  for  each 
of  said  five  years,  shall  be  collected  thereon  for  such  five-year 
period,  or  for  a  shorter  period  if  it  be  clearly  shown  that  any  such 


30  Report  of  the  Commission 

security  was  owned  by  the  deceased  for  less  than  five  years.  Any 
statute  of  limitations  which  would  conflict  with  this  provision 
should  be  to  this  extent  repealed. 

Let  us  see  by  a  concrete  illustration  how  these  recommenda- 
tions would  operate  in  actual  practice.  Take  the  owner  of  a  bond 
worth  $1,000,  yielding  an  annual  income  of  4I/2  per  cent. — that  is, 
$45.  Under  the  present  law  for  the  year  1913  this  owner,  if 
assessed,  pays  $6.10.  Under  the  plan  above  proposed,  if  he 
voluntarily  reports  his  security  and  pays  the  tax,  he  will  pay 
$3.05.  If  he  fails  to  return  his  security  and  it  is  discovered  by 
the  taxing  officials,  he  would  pay  $6.10  plus  $3.05  penalty — that  is, 
$9.15  in  all  for  the  first  year  and  $6.10  for  each  subsequent  year. 
If  he  dies,  and  at  the  time  of  his  death  his  security  is  for  the 
first  time  brought  to  the  attention  of  the  taxing  officials,  his 
estate  would  pay  five  times  $9.15,  or  $45.75,  unless  it  could  be 
clearly  shown  that  the  deceased  had  owned  such  security  for  less 
than  five  years,  when  the  payment  would  be  proportionately  re- 
duced. While  we  think  it  cannot  be  said  that  these  penalties  are 
burdensome  or  unreasonable  under  the  circumstances,  they  are 
heavy  enough  to  induce  many  security-holders  to  make  a  volun- 
tary return  of  their  holdings,  and  to  avail  themselves  of  the 
lowest  rate  rather  than  run  the  risk  of  being  subjected  to  the 
higher  rate,  or  of  having  their  estates  subjected  to  the  highest  of 
all  the  rates. 

Taxation  of  Mortgages. 

There  are  only  four  counties  in  Maryland  in  which  mortgages 
are  now  taxable,  namely,  Dorchester,  Montgomery,  Frederick  and 
Somerset,  and  in  these  the  tax  is  only  for  local  purposes.  In  all 
the  other  counties  they  are  entirely  exempt  by  law.  The  tax  in 
these  counties  amounts  to  8  per  cent,  of  the  interest  covenanted 
to  be  paid.  The  influence  of  this  tax  is  keenly  felt  by  the  pro- 
spective borrowers  in  the  counties  having  the  tax.  Instead  of 
taxing  mortgages,  in  some  instances  the  mortgagee  takes  judg- 
ment confessed  by  the  mortgagor.  Judgments  are  in  general  not 
taxed  in  Maryland.  A  person  or  corporation  having  money  to 
lend  will,  for  obvious  reasons,  prefer  to  lend  it  in  a  county  where 
the  security  will  be  exempt  from  taxes.  The  consequence  is  that 
the  borrower  in  the  county  where  mortgages  are  taxable  finds 


Report  of  the  Commission  31 

that  he  is  unable  to  obtain  money  to  develop  his  farm  or  other 

enterprise. 

The  objection  is  not  so  much  that  mortgages  are  taxable  as  that 
there  is  discrimination  as  between  counties.  The  same  argument 
holds  true  as  between  Maryland  and  its  neighboring  States.  In 
order  to  induce  the  lender  to  place  his  money  in  mortgages  on 
property  in  Maryland,  we  must  meet  the  competition  of  our 
neighboring  States.  In  Delaware  mortgages  are  exempt  from 
taxation.  In  Pennsylvania  they  are  taxed  $4  on  each  $1,000,  and 
in  several  other  States  they  are  taxable  under  the  general  prop- 
erty tax  at  the  regular  State  and  local  rates,  but  are  seldom  listed 
for  taxation. 

It  is  the  contention  of  many  economists  that  mortgages  should 
not  be  taxed  at  all,  for  the  reason  that  in  most  cases  the  borrower 
pays  the  tax  in  the  form  of  increased  interest  rate.  As  a  sure 
method  of  producing  revenue,  however,  the  mortgage  recording 
tax,  which  is  in  operation  in  New  York  and  Michigan,  has  much 
to  recommend  it.  This  plan  provides  for  a  tax  of  50  cents  on 
each  $100  or  fraction  thereof  of  the  principal  debt  or  obligation. 
The  tax  is  payable  at  the  time  of  recording  the  mortgage  and  no 
further  tax  is  imposed.  The  revenues  received  from  this  tax, 
after  deducting  the  expense  of  collection,  belong  one-half  to  the 
State  and  the  other  half  to  the  counties  where  the  real  estate  is 
situated  upon  which  the  mortgage  is  secured.  This  tax  produces 
a  revenue  in  New  York  State  for  State  and  local  purposes 
amounting  to  about  $3,500,000  per  year.  Such  a  tax  cannot  by 
any  possibiilty  be  evaded,  and  it  has,  therefore,  the  great  merit  of 
effectiveness.  There  is  one  feature  of  the  tax  which  is  causing 
considerable  criticism,  and  that  is  the  fact  that  long-term  mort- 
gages are  taxed  the  same  as  short-term  mortgages.  In  other 
words,  the  mortgage  running  for  fifty  years  and  bearing  interest 
for  fifty  years  pays  no  more  tax  than  it  would  pay  if  it  were 
made  for  one  year,  bringing  to  the  owner  only  one  year's  interest. 
Most  of  the  long-term  mortgages  are  those  imposed  on  corporate 
property,  whereas  many  of  the  short-term  loans  are  on  residences 
and  farm  property.  Many  economists  believe  that  the  tax  should 
be  so  graded  that  the  burden  imposed  upon  a  mortgage  running 
for  fifty  years  would  be  proportionately  greater  than  on  the  mort- 
gage running  for  five  years. 


32  Report  of  the  Commission 

Minnesota  adopted  the  mortgage  recording  tax  in  1907,  but  the 
1913  Legislature  greatly  reduced  the  rate. 

From  the  present  state  of  our  mortgage-tax  law  and  the  con- 
ditions which  have  built  themselves  around  it  we  can  draw  but  one 
conclusion,  namely,  that  the  method  of  treatment  should  be  uni- 
form throughout  the  State.  Either  mortgages  should  be  exempt 
in  the  four  counties  in  which  they  are  now  taxable,  or  a  new  tax 
system,  as,  for  instance,  the  recording  tax,  be  installed  through- 
out the  State. 

Inheritance  Taxation. 

Among  many  who  are  familiar  with  the  subject  there  is  an 
impression  that  our  present  system  of  taxing  inheritances  could 
be  improved.  Maryland  was  one  of  the  first  States  of  the  Union 
to  enact  a  law  for  the  taxation  of  inheritances,  and  with  the  ex- 
ception of  the  change  in  the  rate  of  the  tax  from  2i/2  per  cent,  to 
5  per  cent,  in  1908,  there  has  been  very  little  amendment. 

There  are  several  suggestions  which  have  been  made  to  this 
Commission  which  would  seem  worthy  of  consideration,  v^ur 
system  taxes  collateral  inheritances  only  and  estates  of  $500  or 
less  are  exempt.  It  is  contended  by  some  that  the  tax,  with  more 
liberal  exemptions,  should  be  made  to  apply  also  to  direct  inher- 
itances. The  States  which  have  met  with  the  highest  succes-^  in 
increasing  State  revenues  from  this  source  are  those  which  have 
adopted  a  graded  and  progressive  tax,  with  the  rates  as  well  as  the 
exemptions  varying  according  to  the  value  of  the  distributive  share 
and  the  degree  of  relationship  of  the  beneficiary  to  the  decedent. 

Several  States  are  making  an  especial  point  of  applying  the  tax 
to  stocks  in  domestic  corporations  owned  by  estates  of  non- 
resident decedents.  Maryland  does  not  follow  this  policy,  nor  do 
we  think  that  our  State  should  tax  the  inheritance  of  such  shares. 

In  another  part  of  this  report  is  set  out  a  tabulation  of  the  in- 
heritance tax  laws  of  the  other  States. 

Maryland  has  a  law  which  provides  for  a  tax  on  commissions 
allowed  executors  and  administrators — a  provision  which  is  in 
force  in  few  if  in  any  other  States. 

There  are  no  estates  to  which  the  commission  does  not  apply, 
and  in  any  amendment  of  the  law  further  taxing  estates  this  pro- 
vision of  the  law  should  be  considered. 


Report  of  the  Commission  33 

Taxation  of  Public  Stock  and 
Bonds  Issued  by  State  and 
Local  Communities. 

We  consider  this  matter  of  such  great  importance  that  the 
whole  subject  is  treated  at  length  in  a  separate  article.* 

Our  attention  has  also  been  directed  to  a  consideration  of  this 
subject  by  the  numerous  changes  of  laws  in  other  States  exempt- 
iiig  stocks  and  bonds  of  States,  cities  and  counties. 

We  recommend  that  all  stocks,  bonds  and  obligations  created 
by  the  State  or  any  county  or  city  of  the  State  should  be  exempt 
from  all  taxation. 

Income  Taxation. 

The  Wisconsin  income  tax,  as  a  substitute  for  the  general  prop- 
erty tax  on  certain  classes  of  personal  property,  particularly 
moneys  and  credits,  has,  since  its  inauguration  in  1911,  met 
with  considerable  success  from  an  administrative  standpoint, 
and  it  would  be  well  for  our  tax  officials  and  legislators  to 
watch  the  results  of  this  tax  during  the  next  few  years.  South 
Carolina,  Oklahoma  and  Virginia  have  taxed  incomes  for 
several  years  past,  but,  due  to  administrative  defects,  results  have 
not  been  satisfactory. 

Taxation  of  Mineral  Deposits. 

Elsew-here  in  this  reportj  we  have  fully  discussed  the  taxa- 
tion of  mineral  deposits,  and  have  included  therein  a  classifica- 
tion of  the  tax  laws  of  other  States  regarding  this  character  of 
property. 

Taxation  of  Woodlands. 

This  subject  has  been  treated  in  full  in  an  article?  which 
will  be  found  in  another  part  of  this  report,  where  the  laws  of 
those  States  having  special  legislation  on  the  taxation  of 
woodlands  are  digested. 


*See  post:  "Taxation  of  Stock  and  Bonds  Issued  by  State  and  Local 
Communities." 

tSee  post :  "Taxation  of  Mineral  Deposits." 
?See  post:  "Taxation  of  Woodlands." 


34  Report  of  the  Commission 

Exemptions  from  Taxation. 

Every  act  of  reassessment  particularly  sets  out  the  property 
which  is  subject  to  exemption,  and  the  interpretation  of  the 
statute  is  left  to  local  assessors.  There  can  be  no  uniformity 
of  exemption  under  such  a  method. 

It  is  the  opinion  of  the  Commission  that  much  property  in 
the  State  is  enjoying  an  exemption  from  taxation  which  under 
the  present  law  is  properly  taxable. 

In  very  few  cases  has  investigation  revealed  an  assessment 
for  taxation  of  farming  machinery  over  $300,  the  limit  fixed 
by  law,  although  such  an  amount  is  not  now  unusual  on  farms. 

The  Commission  desires  to  draw  attention  to  the  prevalence 
of  extending  exemptions  to  property  owned  by  religious  and 
educational  institutions  not  used  for  religious  and  educational 
purposes,  and  express  the  opinion  that  such  exemptions  are  car- 
ried too  far. 

The  exemption  of  manufacturing  plants  and  machinery  from 
local  taxes  seems  a  favorite  method  of  encouraging  new  indus- 
tries. Local  laws  empower  the  following  communities  to  grant 
the  same : 

Baltimore  City, 

Anne  Arundel  County, 

Harford  County. 

Hagerstown,  in  Washington  County,  encourages  manufacture 
by  this  means,  and  possibly  other  incorporated  towns  are  em- 
powered. 

It  seems  to  us  that  this  policy  should  be  encouraged  and 

extended. 

Household  goods  to  the  extent  of  $300  are  exempt  from  taxa- 
tion in  Baltimore  City  and  Baltimore  County  when  the  owner  is 
not  assessed  for  any  other  property,  but  in  all  other  parts  of  the 
State  there  is  no  exemption  on  such  property.  This  has  been  the 
subject  of  several  coinplaints  to  the  Commission,  and  we  are  of 
the  opinion  that  this  exemption  should  be  extended  throughout 
the  entire  State. 


Report  of  the  Commission  35 

Article  XV  of  the  Bill  of  Rights. 

The  only  constitutional  provision  concerning  taxation  is  set 
out  in  Article  XV  of  the  Bill  of  Rights  of  Maryland  and  is  as 
follows  : 

"That  the  levying  of  taxes  by  the  poll  is  grievous  and  op- 
pressive and  ought  to  be  prohibited;  that  paupers  ought  not 
to  be  assessed  for  the  support  of  the  government,  but  every 
person  in  the  State,  or  person  holding  property  therein,  ought 
to  contribute  his  proportion  of  public  taxes  for  the  support  of 
the  government,  according  to  his  actual  worth  in  real  or  per- 
sonal property;  yet  fines,  duties  or  taxes  may  properly  and 
justly  be  imposed  or  laid  with  a  political  view  for  the  good 
government  and  benefit  of  the  community." 

The  words  "or  persons  holding  property  in  the  State"  were 
substituted  after  a  vehement  debate  for  the  words  "or  persons 
holding  property  therein"  in  the  Constitution  of  1776. 

The  language  of  the  present  section  amounts  to  a  tax 
against  persons,  not  property,  and  should  be  amended,  and 
should  also  be  amended  to  remove  any  doubt  as  to  the 
power  of  the  Legislature  to  make  reasonable  classifications  of 
property. 

Licenses. 

In  another  part  of  this  report*  is  collected  data  on  licenses 
and  the  Commission  makes  the  following  recommendations : 

That  the  State's  participation  in  license  fees  should  be  the 
same  percentage  in  all  communities. 

That  provision  should  be  made  for  inspection  of  stocks  of 
merchants  in  order  to  ascertain  if  traders  obtain  licenses  com- 
mensurate with  their  stock. 

That  the  method  of  issuing  female  traders'  licenses  has  been 
abused  and  a  stricter  inspection  should  be  provided. 

That  applicants  for  renewals  should  be  required  to  surrender 
their  former  licenses  at  time  of  new  application. 

It  is  contended  by  some  Maryland  merchants  that  the  levy- 
ing of  a  trader's  license  places  them  at  a  disadvantage  in  com- 
petition with  merchants  in  neighboring  States.     If  this  is  true. 


*See  post :  "Licenses." 


36  Report  of  the  Commission 

the  permanent  tax  commission  should  provide  a  remedy. 
Nevertheless,  as  long  as  the  present  law  is  on  the  statute 
books  the  license  should  be  levied  equitably. 

Fee  System:     Tax  on  Civil 
Commissions. 

The  method  of  paying  salaries  from  fees  of  offices  is  very  old 
and  has  developed  so  extensively  that  few  people  in  the  State 
realize  to  what  extent  it  reaches.  It  is  only  within  recent  years 
that  accounts  have-  been  demanded  from  the  officers,  and  until 
the  establishment  of  the  office  of  State  Auditor  their  books  and 
receipts  were  never  inspected  in  the  interest  of  the  State. 

The  custom  of  paying  salaries  from  collection  of  fees  has  long 
since  vanished  in  most  other  communities,  and  the  Commission 
recommends  that  all  officers,  including  Clerks  of  Courts,  Sheriffs, 
Registers  of  Wills  and  State's  Attorneys,  should  be  paid  fixed 
annual  salaries  not  in  any  way  dependent  on  their  fees.  All  such 
fees  should  be  remitted  to  the  State. 

In  the  event  of  this  change  being  made  we  recommend  that 
the  tax  on  commissions  issued  to  State  officers  should  be  abol- 
ished. 

This  tax  is  somewhat  unusual.  The  original  idea  of  imposing 
the  tax  was  to  require  officers  to  pay  for  the  opportunity  to 
make  fees,  and  if  they  are  being  required  to  account  for  all 
receipts  they  should  be  released  from  this  payment. 

School  Taxes. 

The  amounts  received  from  the  levies  for  schools  and  free 
books  are  such  a  large  proportion  of  the  whole  revenue,  and  the 
appropriations  made  for  their  maintenance  constitute  such  a  large 
part  of  the  total  expenditures  of  the  State,  that  the  subject  de- 
serves special  consideration,  and  is  treated  in  full  under  the  ap- 
propriate heading  where  much  comparative  data  is  compiled.* 

In  1912  the  levy  for  schools  was  16^^  cents  on  the  $100;  ten 
years  ago,  or  in  1903,  the  levy  was  12^/4  cents,  or  an  increase  in 
levy  in  ten  years  of  3%  cents.  In  the  same  period  the  property 
upon  which  the  rate  was  levied  and  collected  through  collectors 


*See  post:  "School  Taxes." 


Report  of  the  Commission  37 

has  increased  $305,972,677,  or  46  per  cent.,  and  there  has  been 
also  an  increase  in  the  aggregate  value  of  shares  of  Maryland 
corporations  and  in  the  issue  of  Baltimore  City  stock  upon  which 

State  taxes  are  paid. 

1903.  1912. 

*Levy  $824,838  19        $1,579,137  34 

The  following  table  for  the  two  periods  shows  the  changes  that 
have  occurred  in  the  receipts  for  schools : 

*Receipts  from  collectors    (current  and  back 

taxes  included) $771,408  52  $1,457,091  42 

*Receipts  from  Maryland  corporations 71,781  16  114,110  65 

^Receipts  from  Baltimore  City  stock 33,535  93  47,703  52 

$876,725  61        $1,618,905  59 
Increase,  $742,179.98. 

In  addition  to  these  levies  and  payments,  the  State  appropriated 
out  of  the  general  treasury  fund  $105,200  in  1903 ;  $214,800  in 
1912  for  high  schools;  for  colleges,  $153,449.30  in  1903,  and 
$156,789.81  in  1912. 

These  figures  are  taken  from  the  reports  of  the  Comptroller 
for  the  years  contrasted. 

According,  however,  to  the  reports  of  the  State  Board  of  Edu- 
cation, to  which  reference  was  made  for  the  purpose  of  ascer- 
taining the  revenue  arising  from  the  county  school  tax,  it  would 
appear  as  though  the  actual  receipts  from  the  State  have  changed 
in  the  following  manner : 

1903.  1912. 

Total  receipts  from  State $772,105  37        $1,559,852  06 

From  the  reports  of  the  Comptroller,  the  State  increased  its 
payments  84.6  per  cent.,  while  from  reports  of  the  Board  of  Edu- 
cation the  State's  contribution  increased  $787,746.69,  or  102  per 

cent. 

In  the  same  period  the  aggregate  of  county  school  taxes  in- 
creased as  follows : 

1903.  1912. 

Total  county  school  ta.x $1,731,965  34        $2,487,499  74 

*From  Reports  of  the  State  Comptroller. 


38  Report  of  the  Commission 

In  this  period  the  aggregate  of  increase  of  local  school  taxes 
was  $755,534.40,  or  43.6  per  cent. 

In  other  words,  ten  years  ago  the  State  bore  30  per  cent,  of  the 
total  expense  of  the  schools,  while  in  1912  the  charge  had  in- 
creased to  38  per  cent. 

The  following  shows  the  expenditures  for  certain  items  of  the 

schools  for  the  same  period : 

1903.  1912. 

Salary  of  teachers $2,121,533  15  $2,912,376  69 

Rent,  fuel,  incidentals 169,803  36  274,945  97 

Books  and  stationery 133,130  41  228.479  22 

Supervision  62,306  02  112,377  84 

$2,486,772  94        $3,528,179  72 
.  Increase,  $1,041,406.78. 

The  contribution  from  the  State  increases  as  the  State's  taxable 
basis  increases,  and  as  the  State's  contributions  increase  the  local 
levies  for  schools  decrease.  Nineteen  communities  levied  for 
schools  a  rate  less  in  1912  than  in  1911,  and  some  of  these  re- 
ductions were  considerable ;  Allegany  County,  for  instance,  levied 
?.562  on  the  $100  in  1911,  and  $.389  on  the  $100  in  1912.  Some 
of  the  levies  are  as  low  as  $.136  on  the  $100. 

In  1903  eight  counties  received  from  the  State  more  money 
for  schools  than  they  raised  by  local  taxation  for  schools. 

These  counties  were: 

Calvert, 
Caroline, 
Charles, 
Dorchester, 
Prince  George's, 
St.  Mary's, 
Somerset, 
Wicomico. 

In  1912  these  counties  still  received  more  than  they  raised 
themselves,  and  in  addition  to  them  the  following  also  received 
more  than  they  raised  : 

Garrett, 
Howard, 
Talbot, 
Worcester. 


Report  of  the  Commission  39 

In  other  words,  twelve  counties  of  Maryland  do  not  raise  as 
large  an  amount  for  taxes  for  schools  as  was  contributed  to  them 
by  the  State. 

Moreover,  in  1912  all  the  counties  of  the  State  with  the  ex- 
ception of 

Baltimore  County, 

Baltimore  City, 

Carroll  County, 

Harford  County, 

Howard  County, 

Washington  County, 

received  from  the  State  on  account  of  schools  more  than  was 
paid  by  them  to  the  State  for  schools,  roads  and  debt. 

These  questions  arising  from  this  change  are  not  school  ques- 
tions, but  strictly  taxation  questions,  and  deserve  earnest  thought 
on  the  part  of  the  members  of  the  Legislature.  There  must  be 
no  attempt  to  lessen  the  aggregate  of  school  taxes,  but  a  study  of 
the  relative  figures  of  local  and  State  contributions  as  set  out  in 
an  exhaustive  report  on  school  quotations,  contained  in  "A  Com- 
parative Study  of  Public  School  System  in  the  Forty-Eight 
States"  by  the  Director  of  Education  of  the  Russell  Sage  Foun- 
dation (December,  1912),  and  copiously  quoted  from  in  another 
part  of  this  report,  shows  that  only  seven  other  States  in  the 
Union,  viz,  Michigan,  Texas,  Kentucky,  Georgia,  Virginia,  Mis- 
sissippi and  Alabama,  equaled  or  exceeded  the  percentage  of  con- 
tribution of  Maryland. 

The  Commission  recommends  that  each  county  be  required  to 
levy  not  less  than  a  minimum  rate  for  schools. 

It  also  recommends  to  consideration  of  the  proper  authorities 
that  the  present  plan  of  distributing  the  school  funds  on  a  popu- 
lation basis  be  inquired  into  and  consideration  directed  to  an 
average  attendance  basis  with  a  minimum  allowance  for  each 
school. 

The  Commission  recommends  that  the  school  system  be  made 
a  general  State  system  and  the  power  of  local  boards  should  be 
subordinated. 


40  Report  of  the  Commission 

Appropriations  for  Charitable 
Institutions. 

Another  large  State  expense  arises  from  the  State  aid  to  chari- 
table institutions,  and  the  Commission  has  received  information 
that  the  State  Board  of  Aids  and  Charities  is  about  to  submit 
numerous  recommendations  to  the  coming  Legislature  for  con- 
sideration. 

In  another  part  of  this  report,  under  the  head  "Cost  of  Gov- 
ernment in  Maryland,"  is  compiled  appropriations  on  account  of 
all  institutions. 

The  Commission  recommends  to  the  Legislature  that  there 
should  be  a  greater  consolidation  of  energy,  and  that  the  State 
should  adopt  a  policy  of  aid  to  be  based  on  a  plan  whereby  there 
should  be  a  minimum  allowance  for  each  institution  which  is 
selected,  and  in  addition  there  should  be  an  allowance  per  patient 
based  upon  the  actual  time  in  which  such  person  is  in  the  insti- 
tution. 

Good  Roads  and  Their  Effect 
on  the  Value  and  Assessment 
of  Abutting  Property: 

Maryland  in  1908  laid  the  foundation  for  an  extensive  system 
of  good  roads,  to  be  paid  for  from  sales  of  State  bonds. 

At  every  subsequent  session  of  the  Legislature  new  issues  have 
been  authorized  and  the  work  contemplated  has  not  been  com- 
pleted. 

It  is  not  a  part  of  this  Commission's  duty  to  discuss  this  phase 
of  the  question,  except  so  far  as  it  relates  to  taxation. 

The  following  debts  have  been  authorized  for  roads : 

In  1908 $5,000,000  00 

1910 1.000.000  00 

1912 3.170,000  00 

Total $9,170,000  00  " 

The  first  roads  were  completed  about  1909,  and  the  promise 
was  made  that  the  increase  from  taxes  would  take  care  of  the 
interest  and  sinking  fund. 


Report  of  the  Commission  41 

Exhaustive  examinations  have  been  made  in  communities  as  to 
the  probable  increase  of  value  from  good  roads,  but  not  with  en- 
tire success.  Estimates  of  increase  vary  greatly  in  the  same  com- 
munities and  there  are  so  many  other  factors  that  no  absolute 
conclusions  can  be  reached. 

In  all  probability  the  greatest  increase  occurred  in  the  tide- 
water counties,  where  hard  stone  roads  were  before  unknown, 
and  particularly  the  lower  Eastern  Shore  and  Southern  Maryland 
counties. 

In  Wicomico  County,  for  instance,  estimates  run  as  high  as  150 
per  cent,  increase  in  value  of  property  abutting  new  roads.  Many 
of  the  sales  and  assessments  of  the  property  in  the  detailed  dis- 
cussion are  of  property  on  State  roads. 

In  very  few  instances  has  a  single  dollar  been  added  to  the  tax- 
able basis  on  this  account,  and,  moreover,  no  county  has  indicated 
an  intention  to  reassess  such  property  to  bring  assessment  nearer 
the  value. 

Assessment  Plats. 

With  the  exception  of  Baltimore  City,  not  one  community, 
county,  city  or  town  reports  the  use  of  a  plat  for  assessment 
purposes. 

It  seems  impossible  that  any  assessment  can  be  complete  with- 
out a  plat  and  the  State  has  an  excellent  starting  point  in  the 
plats  of  the  counties  made  by  the  State  Geological  Survey. 

True  Consideration  in  Deeds 
or  Affidavits, 

In  many  States  the  question  of  obtaining  information  for 
assessment  purposes  as  to  true  consideration  of  real  estate  sales  is 
being  seriously  considered.  The  plan  generally  advocated  is  to 
restrict  the  recording  privilege  so  that  instruments  afifecting  the 
title  to  real  estate  shall  not  be  admitted  to  record  unless  the  true 
consideration  is  stated  in  the  instrument,  or  unless  an  affidavit 
of  the  grantor  stating  the  true  consideration  accompanies  the 
instrument.  By  the  latter  method  the  true  consideration  w^ould 
not  necessarily  be  shown  upon  the  record  books,  but  the  affidavit 
would  be  considered  confidential  information  to  be  forwarded  to 
the  State  Board  having  supervision  of  tax  matters. 


42  Report  of  the  Commission 

It  is  argued  that  by  this  plan  a  mass  of  accurate  information 
concerning  real  estate  values  throughout  the  State  might  be  col- 
lected without  cost,  which  would  be  of  the  utmost  importance  and 
assistance  to  the  State  Board  in  the  supervision  of  assessments 
and  in  equalization. 

So  far  as  we  know  there  is  no  State  in  which  this  system  is  in 
operation,  but  from  a  theoretical  standpoint  the  plan  would  seem 
quite  logical  and  we  recommend  its  serious  consideration  by  the 
Legislature. 

Cost  of  Government  in 
Maryland. 

Reference  is  made  to  the  classification  of  the  items  of  receipts 
and  expenditures  of  State  government,  and  to  the  compilation  of 
county  assessments,  receipts  and  expenditures,  which  the  Com- 
mission trusts  will  be  of  value  to  all  persons  interested  in  local 
tax  matters. 


Report  of  the  Commission  43 

FINANCES  OF  MARYLAND. 

Sources  of  Revenue. 

The  receipts  of  the  Treasury  of  ^Maryland  are  obtained  from 
numerous  sources. 

The  general  property  tax  is  obtained : 

(a)  From  local  collectors,  from  the  tax  on  real  and  personal 
property,  including  stocks  and  bonds  subject  to  the  30-cent 
local  rate. 

(b)  From  the  tax  on  Maryland  corporations. 

(c)  From  the  tax  on  Baltimore  City  stock. 

Other  sources  of  revenue  are  the  tax  on  gross  receipts,  licenses, 
collateral  inheritances,  excess  of  fees  of  officers,  tax  on  insurance 
companies,  tax  on  savings  banks  deposits,  etc.,  the  details  of 
which  will  appear  from  another  part  of  this  report.* 

The  miscellaneous  taxes  just  mentioned  are  general  treasury 
funds.  The  receipts  from  the  general  property  tax  are  charged 
to  particular  funds,  and  have  heretofore  been  always  for 
schools  and  payments  on  account  of  outstanding  debt,  except, 
however,  a  levy  of  1  cent  for  maintenance  of  roads  in  1913, 
to  which  reference  is  hereinafter  made. 

Owing  to  the  many  new  debts  incurred  in  Maryland  within 
the  past  live  years,  the  general  property  tax  has  increased,  so  that 
now  the  rate  is  31  cents  on  the  $100  of  valuation,  while  in  1910  it 
was  but  16  cents. 

The  returns  from  other  sources  have  not  increased  in  like 
proportion,  and  it  is  very  essential  for  this  State  that  a  perma- 
nent body  should  be  appointed  to  study  constantly  the  subject  of 
taxation  in  every  phase.  Many  questions  are  constantly  arising, 
such  as  the  unearned  increment  tax,  the  secured  debt  law,  pub- 
licity of  assessments,  etc.,  to  say  nothing  of  purely  administrative 
questions. 

The  following  table  shows  the  several  sources  of  revenue  of 
the  States  of  the  Union  so  far  tabulated,  and  is  from  the  last 
report  published  by  the  United  States  Commissioner  of  Corpo- 
rations (November,  1912)  : 


*See  post :  "Cost  of  Government  in  Maryland." 


44 


Report  of  the  Commission 


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Report  of  the  Commission  45 

Separation  of  Sources  of  State 

and  Local  Revenues. 

The  theory  of  separation  of  the  sources  of  state  and  local  reve- 
nues, as  commonly  understood,  means  the  raising  of  revenues  for 
general  state  purposes  by  special  taxation,  as,  for  instance,  gross 
receipt  taxes,  inheritance  taxes,  licenses,  etc.,  and  leaving  the 
general  property  tax  exclusively  for  the  support  of  local  govern- 
ments. For  several  years  past  this  separation  theory  has  occupied 
a  conspicuous  place  in  all  plans  for  improving  systems  of  taxation 
ni  the  various  states.  Some  critics  have  given  first  importance  to 
this  idea,  and  have  urged  that  by  such  separation  existing  inequali- 
ties in  taxation  would  be  removed  and  the  burden  of  taxation 
v^^ould  be  distributed  with  substantial  justice.  It  has  been  argued 
that  by  abolishing  the  direct  state  tax  every  inducement  for  low 
assessment  of  property  subject  to  local  taxation  would  be  re- 
moved, and  that,  automatically,  full  and  fair  valuations  would 
result.  It  has  likewise  been  frequently  urged  that  under  the 
separation  plan  the  various  local  governments  might  be  granted 
either  partial  or  complete  freedom  in  methods  of  taxation,  a 
system  often  designated  "home  rule"  in  taxation. 

One  of  the  chief  objections  urged  against  complete  separation 
of  the  sources  of  state  and  local  revenues  is  that  there  would  be  a 
lack  of  elasticity  in  state  treasury  receipts.  Income  would  not 
adjust  itself  to  the  increasing  or  diminishing  expenditures.  What- 
ever its  defects  otherwise,  the  direct  tax  for  state  purposes  does 
provide  for  this  elasticity  of  revenues. 

Another  objection  is  that  complete  separation  would  probably 
induce  increased  expenditures,  possibly  extravagance,  in  state 
affairs.  As  long  as  a  part  of  state  revenue  is  derived  from  taxes 
paid  directly  by  all  counties,  each  taxpayer  retains  an  interest  in 
economical  state  administration.  All  of  these  arguments  are 
largely  theoretical  when  applied  to  the  complete  separation  idea, 
for  up  to  this  time  no  state  has  broken  away  from  the  general 
property  tax  for  state  purposes  to  the  extent  of  abandoning  it 
forever.  New  York,  Pennsylvania,  New  Jersey,  Connecticut, 
Vermont,  Delaware  and  California  have  been  held  up  by  different 
authorities  as  practical  examples  of  complete  separation,  but  in 
the  tax  systems  of  most  of  these  states  are  factors  which  destroy 
the  complete  separation  feature  and  leave  only  partial  separation. 

For  years  the  only  taxes  in  Maryland  have  been  for  schools 
and    free   books,    and   levies    for   the    payment    of    interest    and 


46  Report  of  the  Commission 

sinking  funds  on  loans  authorized  from  time  to  time  by  the  Legis- 
lature, because  it  should  be  borne  in  mind  that  with  the  exception 
of  one  item  in  1913  there  has  been  no  levy  or  direct  property  tax 
for  costs  of  executive,  legislative,  judicial  or  administrative  func- 
tions of  the  state.  The  expense  of  these  have  been  paid  from 
sources  other  than  taxes  levied  against  property.  Of  the  total 
receipts  of  $5,108,660.32  in  1912,  $2,066,068.77,  or  40  per  cent., 
were  derived  from  property  tax,  and  the  percentage  from  this 
class  has  rapidly  increased  within  recent  years,  owing  to  the 
increase  of  the  state  rate. 

The  General  Property  Tax. 

It  is  the  general  property  tax  that  the  people  of  the  State  feel 
the  most  keenly,  and  yet  the  Commission  believes  that  the 
purposes  for  which  this  is  levied  is  not  generally  understood. 

It  is  only  levied  for  particular  purposes  and  payment  of  obli- 
gations; it  has  no  relation  to  the  general  governmental  ex- 
penses. In  other  words,  all  of  the  returns  of  the  direct  prop- 
erty tax  are  ear-marked  and  should  be  applied  for  these  pur- 
poses. The  changes  in  the  rate  are  brought  about  through 
new  activities,  as  will  appear  clearly  from  a  contrast  of  the 
1912  and  1913  levies  of  the  State. 

In  1912  the  State  levied  the  following  amounts  for  the  items 
enumerated : 

leyg  cents  on  each  $100  for  the   Public  Schools. 

5^      "        "         "         "        "       "     State  Road  Loan  (1908). 

1  "        "         "         "        "       "     Insane  Hospital  Loan  (1910). 

J^  of     1  "        "         "         "        "       '•■     Public  Highway  Loan  (1910). 

^  of    1         "       "        "        "       "       ••     Sanatorium  Loan  (1910). 

and  in  1913  the  following: 

I6ys  cents  on  each  $100  for  the   Public  Schools. 
5>^      "        "         "         "        "       "     State  Road  Loan  (1908). 
M  ofl    1         "        "         "        "       "       "     State  Insane  Hospital 

Loan  (1910). 
M  of     1  "        "         "         "        "       "      Public   Highway  Loan    (1910). 

}i  oi     I  "        "         "         "        "       "     Maryland  State   Normal 

School  Loan  (1912). 
^  of     1  "        "         "         "        "       "     Technical  School   Loan  (1912). 

^  of     1  "        "         "         "        "       "      Second  Insane  Hospital 

Loan  (1912). 

i  1      ;;     ;;     ;;     ;;     ;;    ';    consolidated  Loan  of  1913. 

1  "        "         "         "        "       "      Public  Building  Loan. 

3      ;;     ;;      ;;      ;;     ;;     ;;    state  Loan  of  1912. 

1  "        "         "         "        "       "      Maintenance  of  Roads. 

The  following  table  shows  the  rate  levied  for  each  item  and 
the  aggregate  or  State  rate  since  1900 : 


I. 


Report  of  the  Commission 


47 


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48  Report  of  the  Commission 

A  Detailed  Comparison  of  the  1912  and  1913  Levies. 

In  1913  there  was  levied  \6ys  cents  on  $100  of  property  for 
schools,  which  was  the  same  rate  as  in  1912,  although  the  base 
upon  which  the  same  was  levied  and  paid  through  collectors 
will  show  an  increase,  and  the  amount  of  stock  of  Maryland 
corporations  increased  and  the  issues  of  Baltimore  City  stock 
increased.  The  rate  of  5^  cents  on  account  of  the  State  Road 
loan,  1908,  was  the  same  in  1912  as  in  1913.  The  rate  of  1  cent 
for  the  State  Insane  Hospital  loan  decreased  to  %  of  a  cent,  due 
to  the  increased  basis  of  assessment,  and  the  Public  Highway  loan 
of  1910  increased  y^  oi  2.  cent  owing  to  increased  issue  of 
stock. 

The  levy  of  %  of  1  cent  in  1912  on  an  issue  of  the  $100,000 
Sanatorium  loan  authorized  under  an  act  of  1910  is  not  in- 
cluded, the  reason  for  which  will  appear  by  referring  to  a  study 
of  the  sinking  funds.* 

All  other  levies  for  1913  are  new,  viz:  Three-fourths  of  1 
cent  for  the  Maryland  State  Normal  School,  a  debt  of  $600,000. 

Three-fourths  of  1  cent  for  the  Technical  School  of  1912 
loan  of  $600,000. 

Seven-eighths  of  1  cent  for  Second  Insane  Hospital  loan,  a 
debt  of  $800,000. 

One-half  of  1  cent  for  Consolidated  loan  of  1913,  a  debt  of 
$400,000,  for  armories  in  Annapolis,  Frederick,  Salisbury,  and 
for  forest  reservations. 

Three  cents  for  State  loan  of  1912,  Road  loan  of  $3,170,000. 

All  of  these  loans  were  created  by  Acts  of  1912. 

In  addition  to  these  loans  the  rate  includes  a  levy  of  1  cent 
for  the  Public  Building  loan  of  1904,  which  had  failed  to  be 
included  in  any  levies  since  1906,  although  the  sinking  fund  of 
this  debt  was  not  sufficient  at  that  time  to  retire  the  debt  at  ma- 
turity, nor  has  any  levy  been  made  for  interest  on  this  loan  be- 
tween 1907  and  1912. 

In  addition  to  these  items  of  levy,  the  1913  rate  includes  a 
levy  of  1  cent  on  each  $100  for  maintenance  of  roads,  notwith- 
standing that  receipts  from  licenses  of  motor  vehicles  are 
passed  to  this  account.     This  is  the  first  direct  levy  for  any 


*See  post :  "Report  on  Accumulation  and  Condition  of  Sinking  Funds  for 
State  Loans  Outstanding  September  30,  1912." 


Report  of  the  Co.MMissicjN  49 

item  of  State  expenses  (except  schools)  that  has  been  made 
for  a  great  number  of  years  by  the  State,  and  is  an  innovation 
in  State  financing.  Tlie  amount  produced  by  this  levy  is  un- 
certain and  the  method  inaugurates  a  bad  policy.  If  the  item 
will  produce  $70,000  net  in  1913  (1  cent  on  State  rate  should 
produce  $100,000,  but  the  percentage  of  collection  of  current 
taxes  is  about  70  per  cent.),  the  State  had  far  better  appro- 
priate such  a  fiat  sum.  If  the  rate  remains  the  same  as  estab- 
lished in  1913,  the  amount  raised  on  the  constantly  increasing 
State  base  will  consequently  increase  accordingly. 

It  would  appear,  unless  there  are  radical  changes  made,  that 
a  rate  higher  than  the  present  rate  of  31  cents  will  be  impera- 
tive. 

According  to  the  report  of  the  certified  public  accountant 
employed  by  us  the  1-cent  levy  for  the  Public  Iktilding  loan 
will  have  to  be  increased  slightly  in  order  to  bring  this  sinking 
fund  to  requirement  and  an  additional  levy  will  have  to  be 
made  for  the  State  Loan  of  1902 ;  the  amount  set  aside  for  the 
sinking  fund  of  the  Public  Highway  loan  of  1910  is  not 
snlificient  for  one-half  of  the  amount  authorized,  and  again  all 
of  the  series  of  the  State  loan  of  1912  (Road  loan  of  $3,170,000) 
have  not  been  issued. 

The  Present  Method  of  Setting  Aside  Amounts  for  Sinking 
Funds. 

The  returns  from  a  particular  rate  of  levy  are  uncertain  in 
amount,  owing  to  several  causes.  First,  it  is  levied  on  three 
classes  of  property,  the  taxes  on  which  are  all  paid  in  a  differ- 
ent manner — real  and  personal  property  throughout  the  State, 
paid  by  collectors;  tax  on  IMaryland  corporations,  paid  by 
them  to  the  Comptroller;  tax  on  Baltimore  City  stock,  paid 
by  the  Alayor  and  City  Council  of  Baltimore.  Each  amount 
has  heretofore  increased  at  a  varying  rate.  Again,  the  per- 
centage  of   collections  varies   in   each  and   each   vary   from   the 

others. 

It  is  difficult  to  determine  with  sufficient  accuracy  what  any 
rate  will  produce,  and  this  Commission  submits  a  report  on  the 
subject  for  consideration  of  the  Legislature.  From  this  report 
we  would  direct  attention  particularly  to  the  following: 


50  Report  of  the  Commission 

Sinkiiii^-  funds  are  accelerated  and,  in  consequence,  are  gen- 
erally in  a  condition  after  a  few  years  to  earn  sufficient  on  the 
invested  sinking-  funds  to  carry  them  to  maturity. 

One  illustration  will  suffice,  taken  from  the  State  Building' 
and  Improvement  3  per  cent,  loan  of  1900  of  an  authorized 
issue  of  $500,000. 

From  a  report  of  the  Commission's  accountant  we  quote  as 
follows : 

"This  loan  emphasizes  the  inequalities  of  the  present  method 
of  providing  for  sinking  funds. 

"In  a  single  year— 1901— $100,000,  or  one-fifth  of  the  total 
amount  of  the  loan,  was  set  aside  for  a  sinking  fund  provision, 
although  it  represents  collections  for  the  fiscal  years  1900  and 
1901.  The  difficulty  seems  to  have  been  in  levying  a  rate  out 
of  all  proportion  to  the  needs  of  the  sinking  funds." 

The    Proper  Sinking  Fund  for  the  1908  Road  Loan. 

It  is  more  or  less  a  difficult  matter  to  estimate  the  amount 
that  should  now  be  in  the  sinking  fund  of  this  loan  selected 
for  discussion,  for  several  reasons : 

Series  A,  for  $500,000,  was,  under  the  law,  authorized  as  of 
first  of  August,  1908,  and  the  other  series  of  the  loan  were 
issued  as  of  Fel^ruary  first  of  the  succeeding  years.  There  was 
no  levy  on  account  of  interest  and  sinking  fund  of  this  loan  in 
1908,  because  the  loan  was  authorized  after  the  rate  for  the 
year  had  been  established.  Moreover,  it  would  appear  as 
though  the  several  issues  were  not  sold  at  the  time  provided. 
The  fiscal  year  of  the  State  ends  on  the  30th  of  September,  and 
this  is  a  matter  for  consideration  also. 

The  following  compilation  contains  the  actual  collections 
and  earnings  of  the  sinking  fund  accrued  to  this  loan  for  each 
year,  and  contrasted  with  an  amount  proper  to  be  set  aside 
each  year  to  retire  the  bonds  at  maturity. 


Rmi'ort  ()]■  Till':  Commission 


51 


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52  Report  of  thk  Commission 

$25,912.54  deposited  annually  at  3'/2  per  cent,  interest  will  in 
15  years  produce  an  amount  of  $500,000.  $51,825.08  deposited 
annually  will  in  15  years  produce  an  amount  of  $1,000,000. 

Examination  of  this  table  shows  that  there  have  been  collected 
the  following  amounts  in  excess  of  requirements  : 

1909 $91,419  53 

1910 142.714  70 

1911 191655  65 

1912 230,645  31 

Total $656,435  25 

The  following  shows  the  requirements  of  sinking  fund  and 
the  actual  sinking  fund  payment : 

1909.  1910.  1911.  1912. 

Proper  fund $25,912  54       %77,7i7  62       $129,562  70       $181,387  78 

Sinking  fund  of  loan    100,000  00         84,500  00         182,433  88         295.276  59 

Total,  $414,600.64.    Total  with  earnings $422,922  92  

Total,  $662,210.47.     Total  with  earnings 700,000  00  

In  1912  four-sevenths  of  the  amount  collected  would  have  been 
sufficient  to  pay  the  needed  sinking  fund  and  interest. 

Between  the  actual  condition  of  the  sinking  fund  and  the  col- 
lections there  is  a  difference  of  $407,837.70,  which  has  been 
passed  to  "balance  available  for  transfer." 

The  method  of  setting  aside  a  sinking  fund  leaving  a  balance 
between  the  actual  collections  and  sinking  fimd  and  interest  on 
the  outstanding  loan  is  not  a  good  method,  and  all  sinking  funds 
should  be  composed  of  all  collections  on  account  of  that  par- 
ticular loan  less  payments  on  account  of  interest. 

$10,000  of  this  loan  has  been  cancelled,  and  the  sinking  fund 
assets  were  bought  at  a  discount  of  $10,629.53. 

If  the  present  method  and  rates  are  continued,  the  sinking  fund 
will  equal  the  amount  of  the  loan  long  before  the  date  of  ma- 
turity. 

Article  3,  Section  34  of  the  Constitution  limits  the  State  in 
selling  bonds  for  a  longer  period  than  fifteen  years ;  but  all 
issues,  especially  of  recent  years,  have  been  sold  with  privilege 
of  redemption  in  ten  years.  This  means  that  the  price  bid  is 
on  the  basis  of  a  ten-year  bond,  because  the  investor  figures 
on  bcjnds  of  the  shortest  retirable  period. 


Report  of  the  Commissiox  53 

The  Commission  earnestly  recommends  that  annual 
amounts  should  be  appropriated  sufficient  to  meet  the  interest 
and  sinking-  funds  of  all  loans,  instead  of  levying  a  rate,  and 
that,  in  case  this  cannot  be  done  under  the  present  provisions  of 
the  Constitution,  Article  o.  Section  34,  the  same  should  be 
amended. 

After  all  of  the  amounts  needed  for  all  loans  are  ascertained, 
then  the  State  rate  can  be  fixed. 

The  Commission  also  recommends  that  all  loans  that  now 
contain  sufficient  amounts  in  the  sinking  funds,  and  which  under 
the  law  can  be  redeemed,  be  paid  off. 

These  loans  include  the  following: 

Outstanding.         Sinking  Fund.* 

Consolidated?  $3,191,095  63  $3,111,112  15 

State   buikling  and   improvement 500,000  00  488.724  :>0 

The  State  rate  can  be  materially  decreased,  in  the  opinion  of 
the  Commission,  if  sums  of  money  more  nearly  approaching  the 
re(|uirements  of  loans  are  set  aside  annually. 

Serial  Bonds  Versus  Sinking  Funds. i 

It  does  not  lie  within  the  scope  of  this  report  to  refer  more 
than  briefly  to  the  method  of  retiring  debt  by  means  of  annual 
payments  on  account  of  the  indebtedness  instead  of  creating 
sinking  funds.  But  the  recent  action  of  Massachusetts  requiring 
all  public  debts  of  the  State,  counties  and  cities  to  be  paid  in  an- 
nual instalments  instead  of  by  sinking  funds  is  significant. 

It  is  untried  in  our  State  aft'airs,  but  has  been  tried  so  suc- 
cessfully in  local  matters  as  to  have  become  almost  the  policy 
of  local  financing.  Many  counties  adopt  it,  and  cities  and 
towns  find  it  the  favorite  way  of  raising  money. 


*September  30,  1912. 
tSee  Acts  of  1912,  ch.  477. 
SNoTE — There  is  mucii  literature  on  tliis  question. 
See  Chandler,  Sinking  Funds  and  Serial  Bond  Methods  Compared. 
Sargant — Sinking  Funds. 
Adams — Public  Debt. 

George  M.  Browne — "The  Sinking  Fund." 

Rother — "Partial   Payments  Compared  with   Sinking  Funds."      (Balti- 
more.) 
Special    investigation    of    "Sinking    Funds    and    Serial    Loans    of    the 
Cities  and  Towns  of  the  Commonwealtli."      (Boston,  March,  1913.) 


54  ReP'.^RT   of   TliF    CoM]\IIS>ION 

Objections  to  the  sinking  fund  method  are  chiefly: 

First. — The  management  of  the  sinking  fund  becomes  nothing 
more  or  less  than  an  intricate  system  of  book-keeping  and 
compounding  of  interest. 

Second. — The  rate  of  interest  that  may  be  earned  by  the  in- 
vested sinking  fund  is  uncertain. 

Third. — At  maturity  of  loan  the  invested  sinking  fund  may 
consist  largely  of  loans  of  other  issues,  or  other  funds  which 
must  be  sold  at  market  value. 

Fourth. — Large  accumulations  of  sinking  funds  are  con- 
fusing to  the  man  of  average  intelligence  who  desires  to  be  in- 
formed on  public  affairs. 

Fifth. — It  affords  great  opportunity  for  mismanagement. 

Sixth. — The  ultimate  cost  of  a  loan  is  less  by  the  serial  issue 
plan  than  by  the  sinking  fund  plan. 

The  Basic  Need— A 
Permanent  State 
Tax  Commission. 

We  have  discussed  all  the  features  of  the  taxation  system  of 
the  State  which  we  consider  of  sufficient  importance  to  be  treated 
within  the  scope  of  this  report,  and  especially  within  the  limited 
time  available  for  its  preparation. 

We  have  pointed  out  numerous  defects  in  the  present  tax 
laws — defects  both  in  the  laws  themselves  and  in  their  adminis- 
tration. We  have  called  attention  to  some  of  the  many  tax 
questions  with  which  the  State  is  confronted.  In  some  instances 
we  have  suggested  specific  changes  in  the  laws,  while  in  other 
instances  we  have  been  content  to  outline  the  general  trend  of 
tax  legislation  throughout  the  country. 

Above  all,  we  have  endeavored  to  impress  the  deep  conviction 
that  the  creation  of  a  permanent  State  Tax  Commission  is  a 
matter  of  essential  and  paramount  importance.  Without  such 
a  commission,  new  legislation  can  only  remedy  superficial  de- 
fects, and  the  basic  inequalities  inherent  in  the  present  laws  will 
remain  unchanged.    The  only  practical  solution  for  the  numerous 


Report  of  the  Commission 


00 


tax  problems  now  confronting  the  State  of  Maryland  lies  in  the 
creation  of  a  permanent  State  Tax  Commission. 

•  Respectfully  submitted, 

Henry   F.    Baker,   Chairman ; 
J.  Barry  Mahool, 
E.  Stanley  Gary^ 
.   J.  H.  Gambrill,  Jr., 
William  M.  Cooper, 
Vernon  Cook. 
Allan  C.  Girdwood, 

Secretary. 


55  Report  of  ttie  Commi'^>iox 


ASSESSMENT  IN  MARYLAND. 

Methods  of  Administration: 

Tax  assessors. 

Method  of  assessment  of  farm  property. 

Method  of  assessment  of  town  property. 

Method  of  assessment  of  personal  property. 

Assessment  books. 

Ahenation  lists. 

Time  of  levy. 

Results  of  Present  Administrative  Methods: 

1.  Assessment   Variations   Between   Counties,   as   to; 

Real  property. 
Personal  property. 
Securities. 
Railroads. 
Telephone  companies. 

2.  Local  Variations  in  Assessment,  as  to: 

Farmland ;  acreage. 

Town  property. 

County  assessments  vs.  town  assessments. 

Personal  property. 

Assessments  on  large  i)roperty. 

Assessment  in  Baltimore  City. 

Reports  From  Each  County. 


Assessment — Mf.tiiod  of  Adm  ixistkatfox  hi 


ASSESSMENT  IN  MARYLAND. 

The  actual  administration  of  the  tax  laws  of  Maryland  is  so 
varied  and  ununiform  throughout  the  State  that  anV  treat- 
ment of  the  subject  is  necessarily  a  study  in  contrasts.  In  no 
two  counties  of  the  State  are  the  tax  laws  either  similar  or 
similarly  administered.  In  a  broad  sense,  there  are  as  many 
systems  as  there  are  counties. 

One  of  the  obvious  causes  for  this  utter  lack  of  uniformity 
is  that  the  county  tax  officials  receive  no  general  instructions 
from  the  State  as  to  their  rights  and  duties.  The  interpreta- 
tion as  well  as  the  method  of  administration  of  the  laws  is  left 
to  the  decision  of  the  officials  of  each  county.  Under  these 
conditions  it  is,  therefore,  not  so  much  to  be  wondered  that 
basic  dififerences  are  numerous,  but  rather  that  they  are  not 
more  numerous. 

A  study  of  the  general  system  of  tax  administration  through- 
out the  State  naturally  falls  into  two  main  divisions,  the  first 
concerning  itself  with  methods  of  administration,  the  second 
with  the  results  incident  to  such  methods.  Under  the  second 
division,  the  lack  of  uniformity  in  assessment  between  the  sev- 
eral counties  and  the  lack  of  uniformity  within  the  counties 
themselves  will  receixe  separate  treatment. 


58  Rfj-ort  of  t.'tk  Commission" 


METHODS    OF   ADMINISTRATION. 


TAX   ASSESSORS. 

Upon  the  regular  tax  assessors  of  each  county  devolves  the 
responsibility  of  assessing  all  new  personal  property  and  new 
buildings.  Under  the  present  construction  of  the  law  prevail- 
ing in  practically  every  county  in  the  State,  real  estate  values 
are  only  considered  at  times  of  general  reassessment.  Be- 
tween such  reassessment  periods  all  increases  in  the  taxable 
bases  of  the  counties  are  due  to  increases  in  the  amount  of 
personal  property  and  to  new  building  operations. 

Both  the  number  and  pay  of  these  assessors  vary  from 
county  to  county.  In  Calvert  County  there  are  no  assessors 
at  all,  the  Board  of  County  Commissioners  endeavoring  to 
take  the  place  of  regular  assessors.  The  Commissioners  of 
Calvert  County  receive  no  salary  for  this  work,  the  actual  per- 
formance of  which  is  an  arbitrary  matter  left  to  the  sound  dis- 
cretion of  each  Commissioner.  In  Washington  County,  which 
has  an  area  of  457  square  miles,  the  tax  collector  for  the  countv 
is  the  only  assessor  of  new  property  for  the  entire  county. 
Even  in  Prince  George's  County,  where  there  are  three  asses- 
sors, who  are  paid  $1.00  for  each  assessment  return,  regardless 
of  amount,  the  districts  assigned  to  each  one  are  so  large  that 
it  is  impossible  to  cover  them  satisfactorily.  In  Talbot 
County,  the  County  Treasurer  is  the  only  regular  assessor  em- 
ployed, for  which  service  he  receives  a  salary  of  $300  a  year. 
A  few  counties,  such  as  Caroline  and  Baltimore  County,  have 
assessing  officers  in  each  district,  but  this  is  the  exception 
rather  than  the  rule.  From  the  above  examples  it  will  readily 
be  seen  that  the  assessment  system  of  the  several  counties  is 
thoroughly  divergent  and  complex. 

METHOD   OF  ASSESSMENT   OF    FARM    PROPERTY. 

In  many  counties,  for  purposes  of  assessment,  land  is 
divided  into  different  classes,   the   most  customary  divisions 


Assessment — Method  of  ,\i)Mtxistrat[o.\-  59 

l)einj4-  arable  land,  wood  land  and  marsh  land.  Each  portion 
so  divided  is  then  assessed  at  a  separate  price  per  acre.  Some 
counties  make  even  further  divisions,  Dorchester  County,  for 
instance,  having  as  many  as  seven  different  divisions  of  land 
appearing  on  its  books.  Other  counties,  however,  such  as 
Caroline  and  St.  Mary's,  assess  each  farm  as  an  entirety  at  so 
much  per  acre,  this  per  acre  assessment  representing  the  ag- 
gregate value  of  the  several  classes  of  land. 

The  proper  division  of  farm  land  for  assessment  is  of  much 
importance  whenever  any  transfer  of  title  occurs  which  in- 
volves less  than  the  whole  tract.  For  instance,  if  half  of  a 
two  hundred  acre  farm,  assessed  at  $30  per  acre,  be  sold,  an 
abatement  of  $30  an  acre  for  the  portion  transferred  would  be 
entirely  improper  were  the  half  sold  composed  wholly  of 
woodland,  while  the  remainder  was  made  up  of  good  arable 
land.  Also,  in  cases  where  the  sale  price  per  acre  is  consid- 
erably more  than  the  assessed  price  per  acre,  an  abatement 
based  on  the  sale  price  will  result  in  the  remainder  being  as- 
sessed at  a  price  much  below  not  only  its  actual  value,  but  also 
the  value  formerly  placed  on  it  at  the  last  reassessment 
Indeed,  it  is  a  self-evident  fact,  and  one  that  is  generally  appre- 
ciated throughout  the  counties,  that  the  classification  of  differ- 
ent grades  of  land  for  assessment  is  a  matter  of  great  impor- 
tance. There  can  be  no  doubt  that  at  the  present  time  such 
classification  of  land  throughout  the  State  is,  in  a  vast  number 
of  cases,  uncertain  and  inaccurate. 

METHOD  OF  ASSESSMENT  OF  TOWN   PROPERTY. 

In  the  county  seats  and  larger  towns  property  is  customarily 
assessed  on  the  front  foot  basis,  while  the  small  towns  and  vil- 
lages still  cling  to  the  lot  or  acreage  basis.  The  former 
method,  if  the  depth  of  the  lot  be  also  taken  into  consideration 
(a  matter  that  is  often- disregarded),  necessarily  produces  the 
most  equitable  results.  There  are,  however,  several  incorpo- 
rated towns  so  small  that  the  front  foot  basis  would  not  prove 
applicable. 


60  Report  of  the  Commission 

METHOD  OF  ASSESSMENT  OF  PERSONAL 

PROPERTY. 

There  are  various  different  methods  of  assessing  personal 
property  in  the  counties.  Queen  Anne's  County  has  a  pre- 
pared list  price  for  live  stock  and  other  farm  property,  giving 
specific  assessments  on  each  wagon,  horse,  pig,  cow,  etc. 
Many  other  counties,  while  not  having  actual  lists,  practically 
base  their  assessments  on  this  list  price  theory. 

There  is  also  a  tendency  in  some  counties  to  return  only 
aggregate  assessments  on  live  stock,  or,  at  best,  on  a  certain 
class  of  live  stock,  and  when  questions  of  abatement  or  trans- 
fer occur  it  is  impossible  to  tell  from  the  aggregate  assessment 
what  the  assessment  is  on  the  individual  item  for  which  the 
abatement  is  sought. 

ASSESSMENT   BOOKS. 

With  a  few  unimportant  exceptions,  the  assessment  books 
throughout  the  State  are  absolutely  dissimilar.  Each  county 
designs  and  purchases  its  own  books  and  keeps  them  in  its 
own  particular  way.  Without  the  efiicient  aid  of  the  clerks  of 
the  County  Commissioners,  it  would  be  impossible  for  any 
observer  to  grasp  the  details  of  the  many  systems — and  quite 
often  the  lack  of  system.  Indeed,  if  it  were  not  for  the  wealth 
of  information  usuallv  reposing  in  some  official  who  has  been 
grounded  for  years  in  the  details  of  his  work,  the  present 
methods  of  recording  assessed  property  would  cause  inde- 
scribable confusion. 

It  would  be  useless  to  point  out  the  infinite  number  of  differ- 
ences between  the  counties  in  regard  to  their  systems  of  books, 
for  it  would  be  necessary  for  this  purpose  to  describe  the 
bookkeeping  methods  of  each  county  in  detail.  It  may  be 
well,  however,  to  call  attention  to  a  few  examples  of  the  many 
differences  now  existent : 

1.  In  a  large  number  of  the  counties  real  and  personal  prop- 
erty, while  kept  separate  under  the  names  of  the  individual 
owners,  is  not  totaled  separately.  There  is,  therefore,  no  way, 
short  of  a  special  audit,  of  ascertaining  the  total  amount  of 


.XSSESSMKNT MrTIK)].  (IF  AdM  INISTRATION  61 

real  and  personal  property  within  these  counties.  It  is,  of 
course,  also  impossible  to  determine  the  totals  of  different 
classes  of  real  and  personal  property,  such  as  wood  land,  marsh 
land,  live  stock  and  household  furniture,  althouj^h  with  a 
proper  system  of  books  such  a  division  could  easily  be  arrived 
at  and  would  prove  invaluable  as  a  check  on  improper  district 
and  county  assessment. 

2.  Town  property  is  scarcely  ever  segregated  upon  the 
books  and,  therefore,  it  is  impossible  to  ascertain  the  amount 
of  town  property  assessed  for  county  and  State  purposes. 

3.  In  some  counties  assessment  ledgers  merely  contain  the 
total  assessments  of  real  or  personal  property  (or  both  com- 
Inned)  against  particular  owners,  and  it  is  necessary  to  refer 
to  the  general  assessment  books  to  discover  the  nature  of  the 
property  assessed. 

4.  Some  counties  do  not  even  use  the  general  assessment 
books  at  all,  but  have  made  up  a  system  of  their  own. 

5.  In  many  counties  the  index  system  is  incomplete  and  mis- 
leading, while  a  few  counties,  on  the  other  hand,  have  made 
up  very  complete  and  clear  indexes. 

ALIENATION    LISTS. 

Under  the  general  law  of  the  State  (Art.  81,  Sec.  10),  the 
cleik  of  each  Circuit  C\>urt  is  required  to  transmit  to  the 
County  Commissioners  of  his  county  an  annual  list  of  all  the 
alienations  of  property  within  the  county.  This  list,  properly 
made  up,  enables  the  County  Commissioners  to  keep  track  of 
all  the  transfers  of  real  estate  within  the  county,  and  also  to 
keep  a  record  of  all  assessable  judgments  or  decrees. 

In  practice,  these  lists  are  usually  found  to  be  deficient  in 
important  particulars,  and  in  several  counties  they  are  totally 
disregarded.  In  Washington  County  it  is  said  that  no  aliena- 
tion list  is  kept  at  all,  and  that  tax  bills  are  sent  to  the  owners 
recorded  on  the  assessment  books.  Even,  at  best,  the  descrip- 
tion of  property  taken  from  the  land  records  is  often  insufifi- 
cient  for  the  location  of  the  property  by  anyone  not  an  expert 
survevor. 


62  i^EPORT   OF   THE   COMMISSION 

In  only  one  county — Calvert — do  the  County  Commissioners 
regularly  make  any  change  in  assessment  based  on  the  amount 
of  the  purchase  price  appearing  on  the  alienation  list. 

A  law,  applicable  to  Harford  County  only,  was  passed  by 
the  last  Legislature  (Laws  of  1912,  Chapter  490),  which,  by 
providing  "that  no  deeds  conveying  real  estate  or  chattels  real 
located  in  Harford  County  shall  be  admitted  to  record  among 
the  land  records  of  the  Circuit  Court  for  said  county  until  the 
property  thereby  conveyed  or  assigned  has  been  duly  trans- 
ferred upon  the  property  books  in  the  County  Commissioners' 
office,"  seeks  to  eliminate  some  of  the  many  shortcomings  of 
the  average  alienation  list. 

TIME  OF   LEVY. 

The  time  of  making  the  tax  levy  and  also  the  time  at  which 
taxes  are  begun  to  be  collected  is  also  a  matter  of  wide  varia- 
tion from  county  to  county.  This  subject,  however,  is  fully 
discussed  under  the  general  article  upon  the  collection  of 
taxes. 


Assessment — Resllts  of  Present  ^Ietiiod  63 


RESULTS   OF   PRESENT   ADMINISTRATIVE 

METHODS. 


I. 
ASSESSMENT   VARIATIONS    BETWEEN    COUNTIES. 

Uniiniform  methods  necessarily  produce  ununiform  results. 
Therefore,  it  is  not  to  be  wondered  that  the  application  of  the 
various  and  sundry  methods  of  assessment  in  the  several  coun- 
ties should  lead  to  various  and  sundry  differences  between  the 
assessed  value  of  property  and  its  real  value.  There  are  also 
other  factors  which  figure  largely  in  the  varying  differences  in 
the  percentage  of  the  assessed  value  of  property  and  its  real 
value  in  the  several  counties.  The  most  important  of  these 
relate  to  wide  dift'erences  which  existed  as  to  the  abilities  and 
conscientiousness  of  the  assessors  of  the  several  counties,  and 
even  more  especially  the  aims  of  the  various  Boards  of  County 
Commissioners.  While  a  few  boards  have  made  a  determined 
attempt  to  assess  somewhere  near  full  value,  many  boards  aim 
at  an  assessment  of  from  60  per  cent,  to  75  per  cent,  of  true 
value,  and  there  are  some  which  are  quite  content  to  attain  an 
assessment  of  from  40  per  cent,  to  60  per  cent,  of  true  value 

The  general  result  of  the  varying  factors  has  been  that  the 
average  percentage  of  assessed  value  to  real  value  runs  all  the 
way  from  40  per  cent,  in  some  counties  to  80  per  cent,  in 
others,  an  extremely  large  variation  when  it  is  considered  that 
the  county  which  has  an  80  per  cent,  assessment  value  is 
forced  to  pay  twice  the  proportion  of  State  taxes  that  is  paid 
bv  a  county  which  has  only  a  40  per  cent,  assessment. 

It  should  be  steadily  borne  in  mind  that  it  is  the  varying 
difference  between  the  percentage  of  assessed  value  and  its  real 
value  in  the  several  counties  that  brings  about  inequality.  As  far 
as  equality  is  concerned,  it  is  quite  immaterial  whether  full 
value  be  assessed  or  only  one-half  or  one-quarter  value,  pro- 
vided the  same  percentage  of  assessment  to  value  is  main- 
tained throughout  the  State. 


64  Report  of  ihe  Commission 

REAL    PROPERTY— DIFFERENCES    BETWEEN 

COUNTIES. 

The  assessment  percentage  of  the  true  value  of  real  prop- 
erty is  extremely  varying  and  ununiform  as  between  counties. 
Even  adjoining  counties  often  show  a  wide  range  of  variation 
between  the  percentage  of  real  value  assessed.  Queen  Anne's 
County,  for  instance,  in  which  assessment  on  real  property 
does  not  represent  more  than  50  per  cent,  of  its  value,  adjoins 
Talbot  County,  in  which  the  assessment  is  some  20  per  cent,  or 
25  per  cent,  higher.  In  Prince  George's  County  the  assess- 
ment on  property  averages  about  60  per  cent.,  while  in  Charles 
Count}-,  w  liich  adjoins  it.  the  ])ercentage  of  assessment  to  true 
value  is  75  per  cent,  or  80  per  cent.  These  are  in  no  way  ex- 
ceptional instances. 

Lack  of  knowledge  of  the  percentage  of  assessed  value  to 
true  \alue  in  other  counties  has  often  lead  county  boards  to 
authorize  the  low  assessment  of  property  in  order  to  insure 
their  own  counties  against  possil)le  tax  burdens  due  to  low 
assessment  elsewhere.  There  is  apparently  a  strong  feeling 
prevalent  in  some  of  the  western  counties  that,  compared 
with  the  rest  of  the  State,  the  percentage  of  true  value  assessed 
on  the  Eastern  Shore  is  extremely  low,  when,  as  a  matter  of 
fact,  the  F.astern  Shore  counties  are  no  more  varying  and  un- 
uniform than  are  the  other  counties  of  the  State.  There  is  no 
possible  way  for  the  county  boards  to  determine  the  per- 
centage of  assessed  \  alue  in  the  numerous  counties,  and, 
therefore,  in  order  to  protect  their  own  interests,  low  average 
assessments  Iiave  rather  been  the  rule.  In  some  counties  it  is 
said  that  such  luw  assessments  have  been  a  detriment  rather 
than  a  bcnctit. 

PJ'LRSOXAL   1'Ro1'1-:RTY  —  DIFFERENCES  BETWEEN 

COUNTIES. 

The  assessment  of  personal  property  is  even  more  ununi- 
f(jrm  through(jut  the  counties  than  is  the  assessment  of  real 
estate.  In  some  counties  certain  classes  of  personal  property 
are  assessed  extrcmelv  fulh-;  in  Dorchester,  for  instance,  the 


Assessment — Results  of  Present  Method  65 

assessors  even  going  so  far  as  to  enumerate  chickens  at  50 
cents  each.  In  other  counties,  however,  the  assessment  of  per- 
sonal property  is  extremely  low^.  In  a  number  of  counties  a 
very  large  proportion  of  personal  property  entirely  escapes 
taxation  of  any  kind.  There  are  also  wide  differences  between 
the  policies  of  the  different  counties.  St.  Mary's  County,  for 
instance,  does  not  assess  automobiles,  on  the  theory  that  the 
State  license  tax  sufficiently  covers  this  class  of  property.  In 
Carroll  County,  bank  deposits  are  not  taxed  under  a  ruling  of 
court.  There  are  numerous  other  instances  in  which  personal 
property  taxed  in  one  county  is  not  taxed  in  another,  but  a 
full  statement  of  each  irregularity  would  necessitate  a  com- 
parative treatment  of  each  county  in  the  State  with  all  the 
other  counties,  a  w^ork  which  would  prove  of  no  direct  benefit. 
Suf^cient  it  is  to  say  that  the  differences  between  the  assessed 
value  of  personal  property  in  the  several  counties  and  the  real 
value  of  this  property  are  so  wide  and  divergent  that  it  is  im- 
possible to  i-econcile  them  without  the  aid  of  some  central 
authority. 

SECURITIES  AT  THE  THIRTY-CENT  RATE— DIFFER- 
ENCES BETWEEN  COUNTIES. 

The  imposition  of  the  30  cent  securities  tax  is  even  more 
ununiform  throughout  the  counties  than  is  the  enforcement  of 
either  the  real  or  personal  property  tax.  Four  counties,  viz, 
Calvert,  Caroline,  Garrett  and  Worcester,  do  not  collect  any 
taxes  from  this  source.  In  practically  every  other  county  in 
the  State  the  amount  of  this  class  of  securities  upon  the  assess- 
ment books  represents  a  very  small  percentage  of  the  amount 
actually  held  in  the  county.  There  is  no  doubt  that  some 
Boards  of  County  Commissioners  make  a  more  determined 
effort  to  place  this  character  of  property  upon  the  books  than 
do  other  county  boards,  but  even  due  diligence  often  fails  to 
disclose  the  majority  of  this  property. 

The  greater  portion  of  the  30  cent  rate  securities  tax  is  paid 
by  a  few  especially  conscientious  individuals.  In  Queen 
Anne's  County,  the  entir*  assessment  of  securities  at  this  rate 
amounts  to  $313,331,  and  $257,840  of  this  sum,  or  82  per  cent.. 


66  Report  of  the  Commission 

is  assessed  to  one  woman.  There  is  no  way  of  closely  approxi- 
mating the  amount  of  untaxed  securities  throughout  the  coun- 
ties, but  there  is  no  doubt  this  is  considerably  larger  than  the 
amount  actually  reached  by  taxation. 

RAILROAD    ASSESSMENTS— COUNTY    DIFFER- 
ENCES. 

A  comparison  of  the  assessments  on  railroad  property 
throughout  the  State  will  disclose  very  large  differences  be- 
tween the  percentages  of  true  value  assessed.  On  account  of 
actual  differences  in  the  value,  not  only  of  different  railroads, 
but  also  of  different  portions  of  the  same  railroad,  it  is  useless 
to  make  any  elaborate  comparisons.  The  following  table  gives 
several  examples  of  som.e  of  the  most  striking  differences.  It 
should  be  noted  that  the  varying  assessments  of  railroads  only 
affect  the  several  counties  individually,  the  State's  share  of 
railroad  taxation  being  derived  from  the  gross  receipts  tax. 

COMPARATIVE    RAILROAD    ASSESSMENTS. 

(Per  Mile,  Single  Track.) 

Western  Mary-  Phila.,  Balto.  & 

County.  land  R.  R.  County.  Wasli.  R.  R. 

Frederick $6,000  00  Caroline  $4,000  00 

Carroll 7,500  00  Dorchester 6,000  00 

Washington 6,500  00  Kent 12,000  00 

Allegany 10,000  00  Talbot 4,500  00 

ASSESSMENT  OF  TELEPHONE  PROPERTY- 
COUNTY  DIFFERENCES. 

Assessments  on  telephone  property  in  the  several  counties 
are  quite  as  variable  as  assessments  on  railroads.  Copper 
wire  is  assessed  at  $13.50  per  mile  in  Caroline  and  Talbot 
Counties,  at  $24.50  a  mile  in  Dorchester  County  and  at  $25.00 
a  mile  in  Washington  County.  Iron  wire,  which  in  one 
instance  is  assessed  at  $2.00  a  mile  in  Washington  County,  is 
assessed  at  $6.00  a  mile  in  Calvert  County  and  $10.00  a  mile  in 
Dorchester  County.  In  many  counties  switchboards  are  not 
assessed  at  all,  while  in  Kent  County  they  are  assessed  as 


Assessment — Results  of  Present  Method  67 

much  as  $4.00  "per  drop."  Receivers  and  transmitters,  which 
in  the  majority  of  counties  are  not  listed  at  all,  are  assessed  at 
$5.00  eacli  in  Talbot  County,  $8.00  each  in  Kent  County  and 
$10.00  each  in  Dorchester  County.  The  following  table  gives 
a  clear  idea  of  some  of  the  more  striking  differences  of  assess- 
ment of  the  same  class  of  telephone  property  in  several  of  the 
counties. 

COMPARATIVE   TELEPHONE    ASSESSMENTS. 

Copper  Wire  Iron  Wire  Switchboards 
County.  Poles,     (per  mile),   (per  mile),    (per  drop).      Instruments. 

Calvert  $2  00  $20  00  $6  00  Not  listed.  Not  listed. 

Caroline   1  50  13  50  5  32  .... 

Charles Aggregate  assessment  of  $1(X)  per  mile. 

Dorchester...     2  75*  24  50  10  00  $2  70  $10  00 

Kent  60  OOt  15  00  5  32  4  00  8  00 

Talbot 150  13  50  5  32  2  00  5  00 

Washington    .     3  00$  25  OOt  2  00$         Not  listed.  Not  listed. 

*  Poles  over  35  feet  are  assessed  at  $7.50. 

t  Per  mile. 

t  Assessment  of  Cumberland  Valley  Telephone  Co. 

II. 

LOCAL  ASSESSMENT   VARIATIONS. 

In  addition  to  the  lack  of  uniformity  in  regard  to  assess- 
ments and  assessment  methods  among  the  counties,  there  is 
usually  much  lack  of  uniformity  between  the  districts  com- 
posing each  county. 

FARM  LAND—  LOCAL  VARIATIONS. 

Adjoining  farms  of  equal  value  are  often  assessed  at  differ- 
ent rates,  due  to  favoritism  or  other  similar  causes.  There  are 
certain  large  districts  in  many  of  the  counties  where  assess- 
ments are  uniformly  low  compared  with  the  assessments  on 
property  in  other  portions  of  the  county.  In  Queen  Anne's 
County,  for  instance,  the  assessments  in  two  districts  were  so 
uniformly  low  that  some  of  the  county  officials  seriously  con- 
sidered appealing  to  the  Governor  for  aid.  There  are  very  few 
counties  in  the  State  in  which  the  assessments  for  the  several 
districts  are  uniform  throughout. 


68  Report  of  the  Commission 

ACREAGE. 

No  county  possesses  any  assessment  plats  covering  farm 
property  (or,  for  that  matter,  plats  for  any  assessment  pur- 
poses), and  it  has,  therefore,  been  necessary  to  enter  the  num- 
ber of  acres  returned  by  the  owner  as  correct.  In  the  vast 
majority  of  cases  there  is  no  doubt  but  that  these  returns  have 
been  fairly  accurate,  and  a  very  large  number  of  them  have 
been  checked  up  when  property  was  transferred  by  a  deed  con- 
taining a  clear  description  of  the  acreage  involved.  In  some 
counties,  however,  the  acreage  appearing  on  the  assessment 
books  has  proved  inaccurate,  and  in  some  cases  very  large 
tracts  have  been  entirely  missed.  No  county  in  the  State  has 
yet  totaled  the  whole  number  of  acres  assessed  within  the 
county.  Until  this  is  done  and  the  result  is  compared  with 
the  number  of  acres  actually  contained  within  the  county,  no 
estimate  can  be  formed  as  to  the  number  of  acres  which 
escape  taxation  under  the  methods  now  in  force. 

TOWN  PROPERTY— LOCAL  VARIATIONS. 

Inequality  of  assessment  is  also  noticeable  in  regard  to  town 
property,  but  to  far  less  extent  than  is  prevalent  regarding 
farm  property.  There  are,  however,  in  many  cases,  important 
differences  between  assessments  of  town  property  for  county 
and  for  municipal  purposes.  On  account  of  the  fact  that  the 
county  assessment  books  do  not  segregate  town  property,  it  is 
impossible  to  make  an  accurate  comparison  of  these  varia- 
tions ;  but  in  some  cases,  such  as  in  Cumberland,  for  instance, 
the  difference  between  the  two  assessments  of  the  same  prop- 
erty amounts  to  several  million  dollars.  It  is  a  self-evident 
fact  that  the  same  property  cannot  have  two  different  assess- 
ment values. 

In  the  case  of  some  towns  it  should,  however,  be  borne  in 
mind  that  their  charter  provisions  prohibit  the  levying  of  more 
than  a  certain  amount  for  local  purposes.  When  this  limit  has 
been  reached  the  only  way  for  the  town  to  obtain  more  money 
is  by  increasing  its  assessable  basis.    In  Montgomery  County 


Assessment — Results  of  Present  Method  69 

the  law  specifically  provides  that  assessments  for  State,  county 
and  municipal  purposes  shall  be  identical. 

COUNTRY  ASSESSMENTS  VS.  TOWN  ASSESSMENTS. 

The  assessments  on  country  property  are  often  much  nearer 
their  true  value  than  the  assessments  on  town  property.  As- 
sessments in  such  county  seats  as  Cumberland,  Hagerstown 
and  Salisbury  are  said  to  be  proportionately  lower  as  a  general 
rule  than  farm  property  in  their  respective  counties.  One  of 
the  underlying  causes  for  this  lies  in  the  fact  that  the  value  of 
farm  property  under  the  present  assessor  system  is  much  more 
readily  ascertainable  than  is  that  of  town  property.  There  are 
several  exceptions  to  this  general  rule,  such  as  in  Dorchester 
County,  where  town  property  is  said  to  be  assessed  more 
nearly  its  actual  value  than  is  farm  property. 

LOCAL  VALUATIONS  IN  PERSONAL  PROPERTY. 

Uniform  valuations  for  personal  property  are  sought  to  be 
maintained  throughout  all  the  districts  of  several  counties  by 
the  use  of  list  prices.  By  this  method  the  average  values  of 
horses,  cows,  farm  implements  and  other  classes  of  personal 
property  are  determined  in  advance,  and  the  assessment,  there- 
fore, does  not  take  into  account  the  value  of  separate  items. 
For  a  good  example  of  this  method,  see  the  list  prices  of  per- 
sonal property  appearing  in  the  report  on  Queen  Anne's 
County.  Were  this  list  price  method  conscientiously  carried 
out,  there  could  be  no  district  which  obtained  any  marked 
advantage  over  any  other.  However,  in  almost  every  county 
of  any  size,  there  are  some  districts  in  which  a  much  smaller 
percentage  of  personal  property  is  assessed  than  is  assessed  in 
the  adjoining  districts.  With  the  list  price  method,  uniformity 
depends  merely  on  the  diligence  displayed  by  the  assessor  in  dis- 
covering property.  When  each  article  is  separately  valued,  uni- 
formity depends  not  only  on  the  diligence,  but  on  the  intelligence 
and  fairness  of  the  assessor.  There  is  also  a  varying  amount  of 
personal  property  which  is  entirely  missed  by  the  assessors  who 
have  certain  districts  in  charge. 


70  Report  of  the  Commission 

LOCAL  VARL\TIONS  IN  SECURITIES  AT  THE 
THIRTY-CENT  RATE. 

The  proportion  of  securities  taxed  at  the  30c.  rate  is 
dependent  first  on  the  honesty  of  the  owner  of  this  class  of 
property,  second  on  the  intelligence  of  the  assessors  and 
finally  on  the  diligence  of  the  County  Commissioners  sitting  as 
a  board  of  control  and  review.  Certain  districts  in  some  coun- 
ties return  a  larger  part  of  these  securities  than  other  districts, 
due  to  influence  of  the  factors  above  recited.  As  it  is  only  a 
case  of  discovering  these  securities,  the  question  of  their 
under-assessment  in  certain  districts  never  presents  itself. 

LOCAL  ASSESSMENTS  ON  LARGE  PROPERTY. 

Undoubtedly  the  greatest  lack  of  uniformity  in  assessment 
throughout  the  several  counties  prevails  between  the  actual 
and  the  assessed  value  of  large  property,  whether  owned  by 
corporations  or  individuals.  The  assessor  knows  the  value  of 
small  farm  property,  whether  or  not  he  returns  its  true  value 
for  purposes  of  taxation.  He  also  knows,  or,  at  least,  can 
readily  ascertain,  the  value  of  large  farm  property.  When  the 
average  assessor  comes  to  value  suburban  or  town  property 
his  knowledge  of  values  is  somewhat  less  clear,  and  the  owner 
of  a  large  separate  unit  of  property  will,  in  most  cases,  be  able 
to  procure  a  low  relative  assessment,  for  in  addition  to  the 
assessors'  unfamiliarity  with  such  values,  he  finds  it  difficult 
to  bring  himself  to  assess  a  single  piece  of  property,  either 
business  or  residence,  at  say  $40,000  or  $50,000.  The  assessor 
is  not  thoroughly  accustomed  to  dealing  with  such  figures,  and 
such  an  amount  seems,  therefore,  far  too  high  to  assess  to  one 
individual  owner.  Finally,  however,  when  the  average 
assessor  is  called  upon  to  take  up  the  valuation  for  local  pur- 
poses of  such  difficult  properties  as  railroads,  gas  and  electric 
light  companies,  telephone  and  telegraph  companies,  manufac- 
turing plants,  etc.,  it  is  not  to  be  wondered  that  he  is  generally 
at  sea.  In  the  main,  the  valuation  placed  upon  these  classes  of 
property  by  the  owners  has  been  accepted  as  substantially  cor- 
rect.   In  certain  cases,  where  the  County  Commissioners  have 


Assessment — Results  of  Present  Method  71 

considered  these  valuations  absurdly  low,  increases  have  been 
made,  not  as  the  result  of  a  careful  examination  into  actual 
values,  but  by  such  simple  expedients  as  doubling  the  assess- 
ment throughout,  the  county  authorities  not  considering  them- 
selves to  be  in  a  position  to  employ  experts  to  aid  in  the  deter- 
mination of  a  fair  and  proper  assessment. 

On  the  other  hand,  it  should  be  borne  in  mind  that  in  some 
instances  particular  individuals  and  corporations  have  been 
assessed  at  a  much  higher  percentage  of  true  value  than  that 
prevailing  on  neighboring  property. 

ASSESSMENT    IN    BALTIMORE    CITY. 

In  the  general  discussion  of  assessment  in  Maryland,  condi- 
tions of  assessment  prevailing  in  the  City  of  Baltimore  have 
not  been  treated  on  account  of  the  fact  that  there  is  no  other 
city  in  the  State  properly  comparable  to  it  in  respect  to  prop- 
erty values.  There  also  are  numerous  other  dififerences  which 
would  render  any  attempted  comparison  unsatisfactory. 

One  of  the  most  important  of  these  dififerences  relates  to  the 
fact  that  the  assessment  of  real  estate  as  well  as  personalty  is, 
in  Baltimore,  a  continuous  operation,  whereas  in  the  counties 
new  assessments  on  real  property  are  to  all  practical  purposes 
never  made  except  at  times  of  general  reassessment.  If  the 
same  policy  prevailing  in  the  counties  were  pursued  in  Balti- 
more, there  would  be  considerably  over  $100,000,000  of  un- 
taxed increase  in  real  property  values  accruing  between  pe- 
riods of  reassessment.  This  important  difference  in  method  of 
assessment  between  Baltimore  City  and  the  counties  of  the 
State  is  more  specifically  referred  to  in  the  article  entitled 
"Reassessment  in  Maryland." 

In  regard  to  personalty,  the  Appeal  Tax  Court  of  Baltimore 
has  been  active  in  placing  on  the  assessment  books  a  great 
number  of  securities  at  the  30-cent  rate.  The  value  of  these 
securities  now  amounts  to  over  $178,000,000.  Although  it  is 
not  believed  that  this  amount  represents  a  very  large  per- 
centage of  the  actual  securities  held  in  Baltimore,  yet  it  com- 
.  pares  favorably  to  the  results  obtained  elsewhere  in  the  State. 


72  Keport  of  the  Commission 

Many  of  the  errors  and  omissions  of  property  met  with  in 
the  counties  seldom  occur  in  Baltimore  City,  on  account  of  the 
specialization  of  control  made  possible  by  the  existence  of 
large  property  values  within  a  circumscribed  area,  and  this  is 
especially  true  concerning  corporate  values.  Further  improve- 
ments, however,  are  urgently  needed  in  respect  to  the  general 
system  of  books  and  accounts,  and  reforms  with  these  ends  in 
view  are  being  carefully  planned. 

NOTE. 

Before  taking  up  the  comparison  of  the  percentage  of  assessed  value  to 
true  value  in  the  several  counties  it  may  be  well  to  say  a  word  as  to  the 
general  methods  pursued  in  the  investigation.  In  the  first  place,  the  county 
commissioners  of  each  county  were  reouested  to  state  the  average  per- 
centage of  assessed  value  to  true  value  prevailing  in  their  county.  Not 
only  was  a  personal  investigation  made  in  each  county  to  check  up  those 
replies  and  to  obtain  further  light  on  the  subject  from  other  county  of- 
ficials, but  actual  sale  prices  and  assessment  figures  were  procured  covering 
property  which  had  recently  been  transferred.  These  sale  prices  and  as- 
sessment figures  are  set  out  in  the  several  reports. 

It  was  found  that  there  were  usually  several  officials  in  each  county  who 
had  a  clear  conception  of  the  average  percentage  of  assessment  to  value, 
and  in,  practically,  every  instance  this  percentage  was  admirably  confirmed 
by  actual  figures  obtained  from  the  county  land  records  and  the  assess- 
ment books. 

In  cases,  however,  where  divergent  opinions  existed,  or  where  opinions 
dififered  from  the  actual  figures  obtained,  such  differences  have  been 
steadily  resolved  in  favor  of  the  higher  percentage  of  assessment  to  valua- 
tion rather  than  to  a  lower  one.  in  order  that  there  might  be  no  possible 
chance  of  reporting  lower  conditions  of  assessment  in  any  county  than 
actually  existed. 

In  the  county  reports  which  seek  to  give  the  average  percentage  of 
assessment  to  true  value,  no  infallible  accuracy  is  claimed  as  to  this  per- 
centage. Such  accuracy  could  only  be  insured  by  physical  valuation  of 
the  whole  property  within  the  county  and  the  comparison  of  this  result 
with  the  county  assessment.  It  is.  however,  believed  that  the  present  esti- 
mates throw  a  fair  and  valuable  light  upon  this  subject. 


County  Reports  73 

ALLEGANY  COUNTY. 

Allegany,  although  only  the  tenth  county  in  size,  contains  a 
population  of  over  62,000.  In  this  respect  it  leads  the  whole 
State  with  the  exception  of  Baltimore  County,  which  not  only 
has  a  much  larger  area  but  receives  the  overflow  from  Baltimore 
City.  Cumberland,  the  county  seat  of  Allegany,  enjoys  the  dis- 
tinction of  being  the  second  largest  city  in  the  State. 

The  assessed  basis  of  Allegany  County  is  practically  $30,000,000, 
one-third  of  which  was  an  increase  due  to  the  reassessment  of 
1910.  The  increase  in  the  aggregate  of  assessed  value  in  Al- 
legany County  since  1877  is  the  third  largest  in  the  State. 

There  is  a  very  wide  difference  in  the  character  of  land  in  Al- 
legany County.  Farmland,  woodland,  mountain  land,  coal  land 
are  all  represented  in  abundance.  Large  tracts  of  hitherto  un- 
productive land  are  gradually  being  transformed  into  orchards 
which  are  yearly  contributing  to  the  wealth  of  the  county. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

The  assessments  throughout  the  greater  part  of  Allegany 
County  are  so  ununiform  and  irregular  that  it  is  extremely  diffi- 
cult to  arrive  at  an  accurate  estimate  of  the  percentage  of  assess- 
ment to  true  value.  Town  assessments  are  often  less  than  50 
per  cent,  of  the  real  value  of  the  property,  while  farmland  is  usu- 
ally assessed  at  a  higher  percentage.  The  assessment  in  West- 
ernport.  District  No.  8,  is  high  compared  with  other  districts  in 
the  county,  while  the  assessment  of  land  in  Cumberland  is  ex- 
tremely low  compared  with  its  actual  selling  value.  Taking  the 
many  factors  into  consideration  it  seems  probable  that  60  per 
cent,  would  form  a  fair  estimate  of  the  percentage  of  assessment 
to  true  value  for  the  county  as  a  whole. 

ASSESSMENTS  AND  SALE  PRICES. 

In  the  following  list  of  sale  prices  and  assessments,  taken  from 
the  latest  county  records,  it  will  be  seen  that  the  average  per- 
centage of  assessment  to  sale  price  is  less  than  50  per  cent.     This 


74  Report  of  the  Commission 

is  caused,  in  part,  by  the  fact  that  five  of  the  twelve  instances 
cited  are  examples  of  town  assessments : 


Assessment. 

Sale  Price. 

$1,889  00  (307  Acres) 

$4,500  00 

2,840  00 

6,300  00 

4,630  00  (Cumberland) 

10,000  00 

1,500  00  (Cumberland) 

2,800  00 

500  00  (Cumberland) 

1,000  00 

3,280  00 

5,100  00 

4,275  00  (Cumberland) 

11,000  00 

2,340  00 

3.700  00 

200  00 

525  00 

1,200  00 

2.800  00 

750  00 

1.000  00 

1,400  00  (Frostburg) 

3,000  00 

District  No.  1. 
District  No.  3. 
District  No.  4. 
District  No.  6. 


District  No.  10 

District  No.  16 

District  No.  18 

District  No.  20 

District  No.  32 

$24,804  00  $51,725  00 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

Arable  land  and  woodland  are  often  not  separated  on  the  as- 
sessment books.  What  is  said  to  be  the  best  farm  in  Allegany 
County  is  assessed  at  $30  an  acre.  The  average  assessment  for 
good  farmland  is  about  $20  an  acre.  Woodland  is  usually  as- 
sessed at  $5  an  acre  and  mountain  land  at  $2  an  acre.  There  is 
some  orchard  land  assessed  as  high  as  $100  an  acre. 

District  No.  21  is  the  only  exclusive  farm  district  in  the  county. 
The  following  table  will,  therefore,  give  a  fair  idea  of  the  as- 
sessed value  of  farmland  in  Allegany  County : 

DISTRICT    No.    21. 

No.  of  Total  Total  Average 

Farms.        Acres.  Assessment.  per  Acre.  High.  Low. 

24  3,472  $56,821  00  $16  Z7  $25  00  $8  00 

TOWN  ASSESSMENT. 

There  are  five  incorporated  towns  within  the  county.  As 
stated  previously,  the  assessment  of  town  property  is  much  lower 
than  that  of  farm  property.  Assessments  are  made  on  the  front- 
foot  basis.  The  highest  assessment  in  Cumberland  is  at  the  rate 
of  $400  per  front  foot.  There  is  some  property  of  this  character 
said  to  have  a  market  value  of  from  $1,000  to  $1,500  a  front  foot. 


County  Reports  75 

Lonaconing  and  Midland  get  their  assessed  basis  from  the 
county  assessment  books,  but  Cumberland,  Frostburg  and  West- 
ernport  make  up  their  own  assessable  basis.  Before  the  reassess- 
ment of  1910  the  municipal  tax  basis  of  Cumberland  was  twice 
the  amount  of  the  county  assessment  basis,  but  at  the  present,  on 
account  of  the  recent  State  assessment,  the  difference  between 
them  is  less  striking. 

The  assessment  of  land  in  Cumberland,  while  low,  is  fairly  uni- 
form, but  the  assessments  of  improvements  are  said  to  have  little 
relation  to  value. 

The  owner  of  property  in  Cumberland,  assessed  at  $7,810,  was 
recently  awarded  $42,500  for  the  property  in  a  condemnation  pro- 
ceeding brought  by  a  railroad. 

PERSONAL  PROPERTY. 

All  personal  property  assessments,  aggregating  under  $200, 
have  been  stricken  from  the  books  on  the  ground  that  their  col- 
lection is  too  costly  to  be  remunerative.  Farm  personalty,  such 
as  live  stock,  is  not  assessed  separately,  but  only  the  aggregate 
value  recorded. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

There  are  stocks  and  bonds  to  the  value  of  $1,425,229  on  the 
assessment  books  of  Allegany  County.  Over  a  million  dollars  of 
these  are  assessed  in  the  first  collection  district. 

RAILROAD  ASSESSMENTS. 

The  Western  Maryland  Railroad,  the  Cumberland  and  Penn- 
sylvania and  the  Pittsburgh  and  Connellsville  are  all  assessed  at 
the  rate  of  $10,000  a  mile  for  single  track  and  $20,000  a  mile  for 
double  track. 

The  George's  Creek  and  Cumberland  Railroad  is  assessed 
$6,000  a  mile  for  single  track. 

The  Baltimore  and  Ohio  Railroad,  which  has  very  large  prop- 
erty interests  in  Allegany  County,  is  entirely  exempted  from  pay- 
ment of  taxes. 


7() 


Report  of  the  Commission 


DISTRICT  ASSESSMENTS. 


Real  and  Personal  Property  Not  Separated. 


FIRST    COLLECTION    DISTRICT. 


District  No.    1 $127,781 

District  No.    2 196,142 

District  No.    3 344,484 

District  No.    4 3,170,090 

District  No.    5 1,876,582 

District  No.    6 2.587,713 

Di.strict  No.  14 2,162,436 


District  No.  16 $248,694 

District  No.  20 430,932 

District  No.  21 194,873 

District  No.  22 1,481,054 

District  No.  23 942,455 


$13,763,236 


SECOND    COLLECTION    DISTRICT. 


DistrictNo.il $374,247 

District  No.  12 322,411 

District  No.  13 634,811 

District  No.  17 58,543 

District  No.  24 213,618 


District  No.  26. 
District  No.  28. 
District  No.  32. 


$656,393 
707,493 
406,329 

$3,373,845 


THIRD    COLLECTION    DISTRICT. 


District  No.    7 $257,649 


District  No. 
District  No. 
District  No. 
District  No. 
District  No. 


8 1,141,101 

9 273,756 

10 405,608 

IS 345,293 

18 355,407 


District  No.  19. 
District  No.  25. 
District  No.  27. 


$327,453 
73,499 
89,109 

$3,268,875 


First  Collection  District..  . 
Second  Collection  District. 
Third  Collection  District.  . 


Corporations. 

$1,958,981  83 
2,231,217  13 
3,084,197  48 


Railroads. 

$1,537,199  80 
501.618  IZ 
618,779  15 


Bonds. 
$1,007,686  00 
347,568  00 
69,975  00 


$7,274,396  44        $2,657,597  68        $1,425,229  00 


.  County  Reports  77 

ANNE  ARUNDEL   COUNTY. 

With  the  possible  exception  of  Baltimore  County,  no  county 
offers  such  conditions  in  the  character  of  its  territory  as  does 
Anne  Arundel  County.  The  northern  end  of  the  county,  or  the 
Fifth  District,  adjoins  Baltimore  City,  while  the  southern  end 
thereof  adjoins  Calvert  County,  the  poorest  county  in  the  State. 
Adjoining  immediately  Baltimore  City  are  few  farms,  although 
some  trucking  is  carried  on,  while  there  are  large  manufacturing 
plants  located  with  the  view  of  escaping  municipal  taxes,  and  a 
growing  suburban  population. 

In  this  territory,  lots  of  varying  sizes  are  laid  out.  of  very  un- 
certain value.  Today's  tract  of  acres  may  be  tomorrow's  lot 
development.  In  addition,  too,  Anne  Arundel  offers  a  most  un- 
usual condition  in  water-front  development  for  high-class  resi- 
dence property.  It  is  only  within  the  last  few  years  (about  ten) 
that  the  beauties  of  the  Severn  River,  the  Magothy  River,  Stony 
Creek,  South  River  and  others  have  been  realized.  A  few  years 
ago  the  fronts  were  farms,  but  now  the  banks  are  the  summer 
homes  of  some  very  wealthy  persons.  The  conditions  are 
extraordinary;  to  establish  value,  however,  all  conditions  must  be 
present. 

First,  there  must  be  a  water  front;  as  yet  farms  adjoining  the 
water  property  have  not  been  affected.  There  must  be  ele- 
vation, and  the  nature  of  the  shore  itself  be  such  as  to  appeal 
to  the  homeseeker.  When  all  favorable  conditions  are  met  with 
property  sells  from  $500  to  $1,000  an  acre  in  tracts,  whereas 
twenty  years  ago  $20  per  acre  would  have  been  considered  a 
high  price  for  the  farm  land.  Nearly  all  the  land  on  both  sides 
of  these  rivers  has  changed  hands  since  the  development  began. 

The  assessment  of  such  land  requires  careful  scrutiny  and  ap- 
plication and  individual  observation  to  establish  justice.  No 
general  plan  would  be  fair. 

The  Board  of  County  Commissioners  have  assessed  the  fronts 
at  $75  per  acre,  but  fronts  were  found  upon  investigation 
assessed  at  $12.  They  have  established  no  depth  for  such  assess- 
ment.   One  or  two  of  the  homes  are  assessed  extremely  high. 

A  study  of  sales  and  assessments  of  this  county  is  not  al- 
together satisfactory. 


78  Report  of  the  Commission 

EXECUTORS'   SALES. 

Acres.  District.  Assessment.  Sale. 

Store  and  dwelling 4                      $1,100  $1,200 

House  and  lot Eastport                   975                  1,005 

37/8  acres 2                           115                     200 

208  acres 3                      11,270  14,500 

TRUSTEES'  SALES. 

Acres.  District.          Assessment.  Sale. 

Store    Annapolis  $6,690  $10,000 

House  and  lot Annapolis  3,120  3,550 

39  acres 2  1,565  1,950 

18  acres 8  505  1,100 

House  and  lot Eastport  2,025  1,875 

House  and  lot Annapolis  6,390  8,225 

74  acres 3  1,880  2,500 

Total    $35,635  $46,105- 

The  assessors  in  1911  seem  to  have  missed  many  pieces  of 
property,  as  since  then  there  have  been  the  following  number  of 
separate  pieces  added  to  the  assessment,  discovered  when  owners 
called  at  the  Treasurer's  office  to  ascertain  the  amount  due  on 
property  which  the  owners  found  were  not  assessed : 

District  No.  1 6 

District  No.  2 19 

District  No.  3 25 

District  No.  4 69 

District  No.  5 7 

District  No.  6 1 

District  No.  8 35 

Total 162 

These  were  discovered  in  one  year,  and  it  is  impossible  to  say 
if  there  are  many  properties  not  assessed. 

Many  of  these  were  lots  in  division  of  tracts.  The  assessors 
value  one  lot  in  the  new  development  at  $100,  and  place  the  same 
valuation  on  ten  lots,  but  after  ten  they  are  assessed  at  $8.00 
per  lot,  the  explanation  for  such  a  course  being  that  every  holder 
of  land  ought  to  pay  on  at  least  $100  worth  of  property. 

Marsh  lands  are  assessed  $3.00  per  acre. 

The  best  farms  are  in  the  Third  District,  and  farm  property  is 
high,  well  adapted  to  trucking,  and  in  good  demand. 

Ten  farms,  all  over  100  acres  each,  in  this  district  averaged 
an  assessment  of  $24.90  per  acre  and  $1,516.00  on  improve- 
ments, with  an  average  size  of  206  acres.     Ten  farms,  all  under 


County  Reports  79 

100  acres,  averaged  $19.00  per  acre,  while  improvements  aver- 
aged $348.00.    The  average  size  was  30  acres. 

The  poorest  district  is  the  Eighth,  although  there  are  some  very 
poor  lands  in  the  Fourth  District.  Some  assessments  are  as 
low  as  $3.00  per  acre. 

In  the  Eighth  District  ten  farms,  all  over  100  acres  each, 
averaged  an  assessment  per  acre  of  $13.30  and  $1,080.00  on  im- 
provements, and  137  acres  in  size;;  while  ten  farms,  all  under 
100  acres,  averaged  $8.50  per  acre  on  land  and  $337.50  on  build- 
ings.   The  average  size  was  58  acres. 

SECURITIES. 

There  has  been  $120,000  added  to  this  classification  since  1911, 
because  of  new  assessments  against  two  individuals.  The  large 
portion  of  the  total  assessment  of  $447,985  for  1911  was  against 
trust  estates.  There  are  a  number  of  such  assessments,  small 
in  amount. 

PERSONAL  PROPERTY. 

There  is  an  order  of  the  commissioners  for  classification  of 
personal  property:  Horses  assessed  from  $50  to  $100;  cows  at 
$25,  good,  bad  and  indifferent;  bugeyes  from  $100  to  $800,  and 
automobiles  from  $150  to  $1,000.  The  board  now  receives  from 
the  Commissioner  of  Motor  Vehicles  a  list  of  licenses  on  automo- 
biles issued  to  Anne  Arundel  County  owners. 

The  assessment  on  furniture  is  very  poor  and  insignificant  in 
aggregate  amount. 

TOWN  ASSESSMENTS. 

Annapolis  is  the  only  incorporated  town  in  the  county,  and  the 
assessments  for  municipal  purposes  are  taken  from  the  County 
Commissioners'  books.  Main  and  Maryland  avenues  are  assessed 
in  parts  at  $40.00  a  front  foot,  with  no  allowance  for  depth  of 
lot  or  corner  influence. 


80  Report  of  the  Commission 

IMPROVED  ROADS. 

The  estimate  of  increase  occasioned  by  new  roads  varied  to 
such  an  extent  by  well-posted  men  that  no  percentage  can  be 
cited.  Certain  it  is,  though,  that  the  increase  has  been  very 
marked,  and  no  change  produced  in  the  taxable  basis  of  abutting 
property. 

RAILROAD  ASSESSMENT. 

Railroads  are  assessed  in  each  district.  The  Philadelphia,  Balti- 
more and  Washington  Railroad  is  assessed  at  $22,000.00  a  mile, 
single  track  at  $8,000.00,  and  sidings  at  $5,000.00.  The  assess- 
ment includes  the  right  of  way. 

The  other  steam  road  (Chesapeake  Beach  Railroad,  a  small 
road)  is  assessed  at  $3,000.00  per  mile. 

The  Maryland  Electric  Railway  and  the  W.,  B.  &  A.  are 
electric  railways.  The  W.,  B.  &  A.  is  assessed  uniformly  at 
$7,000.00  a  mile,  sidings  at  $3,000.00,  while  the  Maryland  Elec- 
tric is  assessed  in  Annapolis  District  at  $6,000.00  and  in  the 
Third  at  $7,000.00  a  mile. 

DISTRICT  ASSESSMENTS   FOR   COUNTY   TAXES. 

1 $1,326,696 

2 2,582,843 

3 3,086,971 

4 2,634,385 

5 5,053,852 

6* 4,842,634 

8 1,146,917 

$20,674,298 


*There  was   formerly  a  Seventh  district,  but  it  has  been  merged  with 
others. 


County  Reports  81 


BALTIMORE  CITY. 

Taxation  problems  in  Baltimore  City  are  many  and  varied, 
and  special  commissions  appointed  by  the  city  authorities  from 
time  to  time  have  investigated  conditions  and  reported.  As 
recently  as  1907  there  was  such  a  commission ^  appointed, 
which  treated  the  subject  very  fully;  and  in  1884  there  was  a 
similar  commission. 

Everywhere,  today,  as  in  State  finance,  the  great  taxation 
problem  is  the  rapidly  increasing  expenses,^  brought  about  by 
continual  needs  and  increased  desires.  This  article  does  not  treat 
the  city  problems  as  such,  but  only  those  problems  as  related  to 
State  taxation. 

One  marked  contrast  exists  between  Baltimore  City  and  any 
-other  part  of  the  State  or  the  whole  State.  In  Baltimore 
there  is  the  Appeal  Tax  Court  having"  in  charge  all  matters  of 
taxation  and  under  mandate  to  review  every  piece  of  property 
at  least  once  in  every  five  years. ^  Compared  with  the  lack  of 
any  such  continuing  system  in  the  State,  the  result  is  very 
unjust  to  Baltimore,  as  compared  with  other  sections  of  the 
State.  The  reassessment  under  the  act  of  1910  in  the  counties 
was  the  first  since  1896,  prior  to  which  there  had  been  none 
since  1876.  Assessments  have  generally  remained  at  the  same 
valuation  from  one  period  of  reassessment  until  the  next, 
taking  no  account  of  the  intervening  change  of  value. 

One  of  the  greatest  drawbacks  in  general  reassessments 
after  intervals  is  the  practical  impossiblity  of  obtaining  capable 
and  experienced  assessors  for  all  of  the  work.  On  the  other 
hand,  under  the  system  of  continuing  reassessments,  assessors 
are  permanently  employed  and  become  trained.  Where  the 
reassessments  are  at  intervals,  with  intervening  periods  of  in- 
action, the  services  of  the  assessors  cease  after  a  few  months. 


1  Advisory  Committee  on  Taxation  and  Revenue  appointed  by  J.  Barry 
Mahool,  Mayor.  The  executive  committee  was  composed  of  Jacob  H. 
Hollander,  chairman ;  George  R.  Gaither,  Thomas  G.  Hayes,  Frank  N. 
Hoen  and  Charles  C.  Homer. 

2  Total  expenses  of  city  for  all  purposes  in  1903  was  $11,146,732.41,  and 
in  1912,  the  total  expenses  for  all  purposes  was  $22,038,987.04  (including 
in  both  cases  the  proceeds  of  permanent  loans). 

2  For  legislation — ^see  report  of  1907. 


82  Report  of  the  Commission 

In  Maryland  these  general  reassessments  have  not  even  been 
at  stated  intervals,  but  at  irregular  times,  sometimes  as  much 
as  twenty  years  apart,  and  then  only  after  new  legislation  fol- 
lowing dissatisfaction  and  political  agitation. 

The  Commission  of  1907  treated  this  subject  of  continuing 
reassessment  very  fully,  and  made  the  following  comments  ;■* 

"A  new  general  assessment  is  obviously  no  solution.  Ref- 
erence has  already  been  made  to  the  primary  consideration 
that  the  very  conditions — haste,  inexperience  and  political 
pressure — under  which  such  a  general  reassessment  must  be 
planned  and  executed,  are  certain  to  prevent  full  and  uniform 
assessment.  But  more  than  this,  even  if  a  general  assess- 
ment should  result  in  full  valuation,  it  fails  completely  to  keep 
the  taxable  basis  steadily  and  continuously  up  to  that 
standard.  \\'itliin  a  few  years  the  old  conditions  are  certain 
to  reappear,  while  any  attempt  to  provide  by  law  for  periodic 
reassessment,  say  at  five  or  ten-year  inter\als,  works  out 
either  in  default,  as  exemplified  by  local  experience,  or  in  a 
disturbing  readjustment  of  property  A-alues  tliat  unsettles 
legitimate  trade  and  encourages  speculati\e  activity  in  real 
estate. 

"The  ideal  condition  is  obviously  a  continuing  revision  of 
real  estate  assessments  which  will  bring  taxable  values 
gradually  and  without  jar  or  dislocation,  up  to  full  market 
values,  and  thereafter  by  systematic  acti\ity  in  the  same 
direction,  maintain  the  taxable  basis  at  this  standard." 

That  some  of  the  real  property  in  Baltimore  is  over-assessed 
there  is  no  doubt — much  more,  in  fact,  than  in  any  other  part 
of  the  State.  A  great  amount  of  property  is  assessed  very 
near  the  actual  worth.  Xor  can  it  be  denied  that  some 
property  is  still  under-assessed,  but  the  percentage  of  escaped 
value  is  negligible  compared  to  the  conditions  in  other  parts 
of  the  State.  As  it  is,  the  under-assessed  property  in  Balti- 
more will  be  reviewed  for  reassessment  sooner  than  would  be 
the  case  in  any  county  where  propertv  has  been  under-\'alued 
at  one  general  reassessment  or  has  increased  in  value  since 
such  assessment  and  is  waiting  for  another  long  delav.  In 
another  cycle  of  years  the  assessment  will  be  rc\'ised  under  tlic 
l^lan  of  continuing  reassessment. 
""•  Reporl  <i  \^07.  yp.   114  and   115. 


County  Reports  83 

'I'lie  Commission  of  1907  made  the  following'  comment  on 
ihe  equalization  of  assessments  in  Baltimore  City: 

"That  the  assessed  valuation  of  real  estate  in  Baltimore  is 
substantially  less  than  its  actual  market  value,  and  that  this 
inequaliy,  far  from  beini^-  uniform,  is  very  different  in  different 
localities,  and  with  respect  to  the  several  classes  of  property, 
is  a  widespread  impression  and  a  reasonably  probable  fact. 
It  is  impossible  to  speak  with  any  houseowner  in  Baltimore 
of  matters  of  real  estate  taxation  without  hearini^-  a  tale  of 
woe,  accompanied  either  by  resentment  or  resignation,  of  over- 
assessment,  of  under-assessment,  of  inability  to  secure  abate- 
ment for  declines  in  market  values  here  and  of  failure  to  take 
notice  of  sharp  increments  of  value  there.  If  conference  be 
had  with  persons  of  larger  or  more  technical  experience  in  real 
estate  values,  these  individual  complaints  become  so  specific 
and  convincing  as  to  make  it  well  nigh  impossible  to  escape 
the  belief  of  a  material  and  irregular  divergence  between 
assessed  and  actual  values.  If  time  and  resources  were  avail- 
able, it  would  be  possible  for  us  to  coafirm  or  to  refute  this 
pcjpular  impression  by  independent  investigation.""' 

It  is  only  proper  to  say,  however,  that  since  this  statement 
was  made  there  has  been  a  vast  change  and  imorovement  in 
the  assessment  conditions  of  Baltimore.  In  this  interval  no 
less  than  114,991  parcels  of  property  have  been  reassessed  by 
the  Appeal  Tax  Court  on  its  own  motion.  In  addition  to  this, 
there  have  also  been  17,521  cases  involving  the  review  of 
properties  at  the  instance  of  owners,  and  the  assessment  of 
new  improvements  and  additions  to  old  l)uildings. 

The  total  number  of  separately  assessed  lots  of  ground  in 
the  city  is  approximately  130,000.  Nine  assessors  give  their 
exclusive  attention  to  real  estate.  Besides  this  the  Appeal 
Tax  Court  has  a  force  of  tw^enty-eight  men  engaged  in  clerical 
work  and  the  assessment  of  personal  property. 

The  State  is  chiefly  concerned  with  an  equitable  assessment. 
This  means  equality  as  between  property  of  the  citizens  in  one 
county  compared  with  the  property  of  the  citizens  in  another, 
and  as  between  property  of  citizens  in  different  parts  of  any 
county  or  city.  Moreover,  if  parts  of  Baltimore  arc  over- 
assessed  and  the  assessment  is  kept  high  for  the  purpose  of 
maintaining  a  low  municipal  rate,  it  is  just  as  much  the  duty 

5  Report  of  1907,  p.  110. 


84  Report  of  the  Commission 

of   the    State    to    demand    for    these    citizens    a    reduction    of 
assessment. 

While  it  has  not  been  practicable  to  make  an  exhaustive 
investigation  of  assessments  either  in  Baltimore  or  in  all  the 
other  sections  of  the  State,  the  following  recent  trustees'  sales, 
taken  from  the  records  of  the  equity  courts,  will  serve  to  give 
a  comparison  between  sales  prices  and  existing  assessments: 

TRUSTEES'  SALES/' 

No.  Assessment.  Sale  Price. 

1 $1,961.00  $1,995.00* 

2 1,667.00  2.018.00* 

3 666.00  850.00* 

4 2,250.00  2,160.00* 

5t 3,125.00  3,625.00* 

6 3,267.00  3,900.00* 

7 1.086.00  1,105.00* 

8 1.619.00  2,075.00 

9 1,250.00  1,675.00* 

lot 600.00  315.00 

•11 4,617.00  4,900.00* 

12 9,294.00  7,889.25* 

13 892.00  1,175.00* 

14 1,320.00  1,333.00* 

15 27,000.00  18,500.00 

16 2,150.00  3,400.00 

17 1,120.00  1,150.00 

18 1,263.00  1.125.00 

19 1,263.00  1,700.00 

20 1,263.00  1,800.00 

21 1,933.00  2,550.00 

22 5,077.00  4,750.00* 

23 5,975.00  6,575.00 

24 3,216.00  3,893.00* 

25 32,000.00  27,400.00 

26 •.  1,672.00  2,090.00* 

27 17,634.00  15,825.00* 

28 1,700.00     ,  2,320.00* 

29 2,540.00  2,773.00* 

30 2,914.00  3,600.00* 

31 ■ 2,684.00  3,350.00* 

32 4,000.00  4,675.00* 

33 2,717.00             ■       2,950.00* 

34 1,283.00  1,230.00 

35 5,600.00  6,300.00* 

36 2,756.00  2,425.00* 

37 7,050.00  10,050.00 

Total $168,354.00  $162,436.25 

G  No  attempt  was  made  at  selection.     The  sales  were  taken  in  the  order 

in  which  they  were  reported  to  the  Circuit  Court  and  Circuit  Court  No.  2 

of  Baltimore  City. 

*  Sold  subject  to'  annual  ground  rent;  capitalized  value  of  ground  rent 

included  m  determining  fee  simple  selling  basis, 
t  Vacant  property. 


County  Reports  85 

THE  GROUND  RENT  SYSTEM  AND  ASSESSMENT. 

The  system  of  ground  rents  in  use  in  Baltimore  is  one 
difficulty  in  the  way  of  a  comparison  of  sales  and  assessments. 

Leases  creating-  ground  rents  or  annual  reversions  stipulate 
that  lessees  and  their  assigns  shall  pay  all  taxes  and  assess- 
ments levied  on  the  property.  The  assessing  officers  do  not 
assess  the  ground  rents ;  their  duty  is  to  assess  the  lot  and  im- 
provements (if  any)  without  regard  to  liens,  encumbrances  or 
status  of  ownership. 

This  assessable  or  fee-simple  selling  value  of  a  lot  may  be 
more  or  less  than  the  leasing  value  per  front  foot ;  and  where 
the  lot  is  improved  and  the  ground  rent  is  therefore  secured, 
not  only  by  tbe  land  but  also  by  the  improvement,  there  is 
obviously  still  less  relation  between  the  value  of  the  ground 
rent  and  the  value  of  the  lot. 

A  lot  in  the  residence  section  may  be  worth  $800,  while  the 
ground  rent  thereon  may  be  placed  at  $75  a  year;  capitalized 
at  6  per  cent.,  the  rent  would  be  $1,250;  this  is  because  the 
rent  is  also  secured  by  the  improvements.  On  the  other  hand, 
a  lot  worth  $3,000  may  carry  a  rent  of  $60,  which  has  a  capi- 
talized value  of  only  $1,000.  In  buying  the  leasehold  interest 
the  purchaser  does  not  take  into  consideration  merely  the  true 
value  of  the  lot,  but  also  what  the  improvement  may  be  worth. 
The  value  of  the  ground  rent  to  the  owner  does  not  fix  the 
value  of  the  lot;  but  the  combined  value  of  ground  rent  and 
leasehold  interest  has  a  very  close  correspondence  to  the  com- 
bined value  of  lot  and  building. 

There  is  a  not  uncommon  impression  that  homes  are 
assessed  greatly  beyond  their  value ;  the  error  in  many  cases 
is  due  to  the  fact  that  the  owner  fails  to  realize  that  by  con- 
tract as  well  as  by  provision  of  law  the  leaseholder  has  as- 
sumed the  obligation  of  paying  taxes  not  merely  on  the  lease- 
hold estate  but  on  the  fee  simple  value  of  the  property. 

ADJOINING  COUNTIES. 

Under  this  head  in  Baltimore  County*  is  set  out  some 
assessments  of  the  property  lying  partly  within  Baltimore 
City  and  partly  within  Baltimore  County. 

*  See  post  "Baltimore  County." 


86  Report  of  the  Commission 

SECURITIES  AT  THE  30-CENT  RATE. 

The  assessment  against  this  class  of  property  in  Baltimore 
City  for  191,3  was  $177,383,419,  while  for  1914  the  assessment 
aggregates  $191,970,999. 

PERSONAL  PROPERTY. 

In  I'altimore  City,  as  in  all  other  localities  where  house- 
hold property  is  subject  to  taxation,  the  administration  of  this 
tax  has  caused  misunderstanding  and  complaint.  In  an  effort 
to  appease  a  certain  class  of  owners  whose  claims  were  deemed 
to  have  merit,  the  Legislature  of  1910  passed  an  act  (Chap- 
ter 619)  providing  that  "all  bona  fide  residents  of  the  State 
owning  only  household  effects  the  value  of  which  is  less  than 
$300,  shall  be  exempt  from  taxation  on  the  same."  This  act 
applies  to  Baltimore  City  and  also  to  Baltimore  County,  but 
not  to  the  rest  of  the  State. 

Some  doubt  exists  as  to  the  constitutionality  of  the  law 
because  it  is  not  general  in  its  operation.  The  policy  of  the 
act  has  also  been  criticised  on  the  ground  that  it  discourages 
the  acquisition  of  property  and  because  the  exemption  of  $300 
does  not  apply  to  all  owners  of  household  effects. 

Automobiles,  as  a  general  rule,  are  assessed  for  the  first 
vear  at  two-thirds  of  their  cost ;  for  the  second  year  at  50 
per  cent. ;  and  for  the  third  year  at  40  per  cent. 

TAX  MAPS. 

The  city  has  a  complete  set  of  plats  for  assessment  purposes. 
With  constant  changes  of  values  and  re-assessments,  it  is  not 
surprising  that  the  system  has  become  complicated ;  but  there 
would  seem  to  be  room  for  simplification,  so  that  the  taxpayer 
may  be  able  to  ascertain  his  assessment  more  quickly  than  at 
present. 

Real  property  assessments  are  made  and  entered  according 
to  location,  while  the  collection  of  taxes  thereon  is  made  from 
alphabetical  lists  of  owners. 

The  Appeal  Tax  Court  is  aware  of  the  difticulties  which 
arise  from  this  dual  system  of  bookkeeping  and  has  secured 


County  Reports  87 

a  substantial  appropriation  from  the  city  for  the  i)urpose  of 
improving-  its  clerical  records  and  bringing  about  greater 
harmony  and  co-ordination  with  the  records  of  the  City 
Collector. 

RAILROAD  ASSP:SSMENTS. 

The  method  of  valuing  railroad  property  for  taxation  pur- 
poses in  Baltimore  is  different  from  the  system  in  any  part 
o(  the  State. 

The  unit  of  value  of  the  right-of-way  is  $25,000  per  single- 
track  mile.  The  assessment  of  single-track  construction  is 
$6,500  a  mile;  double-track  construction,  $15,000;  triple, 
$21,000,  and  quadruple,  $27,000. 

Assessments  conse(|uently  aggregate  the  following  amounts 
per  mile  : 

For  single  track    (  right  of  way  and  construction ) $31,500 

For  double  track   ( right  of  way  and  construction) 65,000 

For  triple  track   ( right  of  way  and  construction) 96,000 

For  quadruple  track   (  right  of  way  and  construction) 127,000 

The  right-of-way  of  the  Union  Railroad  Company  is 
assessed  at  $75,000  per  single-track  mile,  owing  to  its  excep- 
tional condition.  This  makes  the  assessment  of  one  mile  of 
double  track  (right-of-way  and  construction)  $165,000. 

BALTIMORE  CrfY  TAXABLE  BASIS  FOR   1913. 

Real  estate  (full   city  rate) $335,808,161 

Real  estate   (suburban  rate) '. 18,774.094 

Real  estate   (rural   rate) 29,383,350 

Perscnal — Individuals,    lirms    and    foreign    corpo- 
rations       $48,169,754 

Less   plant  exemption '.  . .  .         4,511,466 

43.658,288 

Shares  of  Maryland  Corporations   (estimated)...     $48,096,791 

Less  plant  exemptions 6,096,791 

42,000,000 

Distilled  spirits  in  bond  (estimated) 900,000 

Securities  (30-cent  rate) 177.385,419 

Deposits  in  savings  banks   (estimated  18%  cents) 94,000,000 

Total $741,909,312 


88  Report  of  the  Commission 


BALTIMORE   COUNTY. 

Baltimore  County,  with  a  population  according  to  the  last 
ciensus  of  122,309,  contains  practically  twice  as  many  people  as 
the  next  populous  county.  Its  percentage  of  increase,  between 
the  periods  of  1900  and  1910,  was  the  greatest  in  the  State.  This 
county  has  the  largest  taxable  basis  of  any  of  the  counties  of 
Maryland,  and  its  assessment  per  capita  is  $1,167.03.  This  is 
more  than  the  per  capita  assessment  of  Baltimore  City,  which  is 
$922.96.  The  county  is  one  of  the  largest  counties  in  the  State, 
with  an  area  of  656  square  miles,  which  is  but  slightly  smaller 
than  Garrett  and  Frederick  Counties. 

Many  thousands  of  its  citizens  who  pursue  their  daily  occupa- 
tions within  the  City  of  Baltimore  live  in  Baltimore  County,  and 
this  tendency  is  bound  to  continue. 

The  interests  of  Baltimore  County  are  varied,  and  property 
values  have  a  very  large  range.  There  are  no  less  than  21,590 
separate  assessments  on  the  tax  books,  and  the  basis  of  valuation 
for  taxation  purposes  has  increased  steadily  and  constantly.  This 
is  one  of  the  few  counties  in  Maryland  that  has  no  debt. 

Baltimore  County  completely  surrounds  Baltimore  City  on  the 
latter's  eastern,  northern  and  western  boundaries  and  nearly  all 
of  its  southern  Iwundary,  the  balance  of  the  southern  boundary 
of  Baltimore  City  being  the  Patapsco  river.  The  division  lines 
between  Baltimore  City  and  Baltimore  County  are  largely  fictions, 
and  city  development  extends  into  the  county.  As  one  leaves 
the  city  boundary,  there  is  first  a  territory  thickly  sealed;  then 
the  homes  become  fewer,  and  country  homes  are  the  rule  in  many 
cases  with  large  grounds.  Finally,  within  short  distances,  are  the 
farms.  The  upper  ends  of  the  county  are  devoted  exclusively  to 
farming.  In  many  parts  of  the  county  are  large  manufacturing 
plants. 

One  hears  that  the  suburl)an  portion  of  Baltimore  County  is 
carrying  the  entire  county,  while  again  the  claim  is  made  in  some 
quarters  that  the  farmers  are  paying  the  tax  of  the  suburbanites, 
and  that  the  farmer  is  getting  the  smaller  part  of  the  improve- 
ments.    Investigation    conclusively    supports    neither    claim.     In 


County  Rei'orts  89 

the  lirsi  z(jnc  is  much  property  on  the  tax  l)ooks  at  iuuler-\ahia- 
tion,  so  m  the  next  zone,  and  even  so  in  the  outlying  sections. 
It  is  extremely  difficult  to  figure  the  percentage  of  assessed  valua- 
tion to  actual  value.  In  the  first  zone  there  is  some  property 
over-assessed,  so  in  the  second,  and  so  in  the  third  zone. 

Comparisons  have  been  made  of  property  in  the  first  zone  with 
property  of  like  kind  in  Baltimore  City,  and  in  the  outlying  ter- 
ritories properties  have  been  compared  with  properties  in  those 
counties  on  which  Baltimore  County  borders.  The  conclusion  is 
that  Baltimore  County  offers  the  usual  conditions  found  in  every 
part  of  the  State — namely,  lack  of  a  system  of  assessment  and 
scientific  method  of  valuation. 

One  difficulty  in  study  of  assessment  methods  is  the  rapid 
change  from  tracts  into  lots  in  the  proximity  of  Baltimore  City. 
Ninety-five  per  cent,  of  the  conveyances  each  day  are  lots. 

Building  permits  are  required  in  the  First,  Third,  Ninth, 
Twelfth,  Thirteenth  and  Fourteenth  Districts,  but  in  none  of  the 
others.  At  the  time  of  development  and  erection  of  new  build- 
ings the  lots  are  reassessed.  It  is  inconceivable  how  any  assess- 
ment can  be  complete  in  the  congested  territory  of  Baltimore 
County  without  plats. 

SALES  BY  TRUSTEES. 

Acres.  District.  Assessment.  Sale. 

House  and  lot 9  $2,485.00  $3,075.00 

9  1,735.00  2,800.00 

3 •        1  3,650.00  5,760.00 

25     8  2,500.00  4,500.00 

88     9  10,530.00  13,475.00 

12     ...• 9  4,550.00  7,225.00 

2%                         4  1,930.00  2,225.00 

4. 1  1.750.00  2,200.00 

12              15  1.425.00  2,119.50 

7                            9  1,290.00  1,800.00 

14                              9  4,450.00  5,900.00 

10                                   ....  14  2,000.00  2,900.00 

House  and  lot 12  1.000.00  1,400.00 

•      •■  12  1,000.00  1,375.00 

2  11  1,000.00  2,400.00 

Zl                                   ...  6  444.00  586.00 

10  14  1,625.00  2,250.00 

^01.'.  9  3,650.00  6,800.00 

S?  ■  9  10,000.00  8,200.00 

951,4  9  1,575.00  3,000.00 

5  I  ots                          ....  15  500.00  750.00 

House  and  lot 3  2,950.00  6,166.67 

■•      ••  9  750.00  500.00 

■•      "  12  900.00  1,270.00 

Total $63,689.00  $88,677.17 

(  \'alue  of  rents  underlying  leasehold  property  computed  at  6  per  cent.) 


90  Report  of  the  Commission 

No  endeavor  was  made  to  select  large  properties.  Sales  were 
selected  as  near  as  possible  in  the  order  in  which  they  occurred. 

ASSESSMENT  METHODS. 

Properties  in  different  parts  of  the  county  have  not  the  same 
value,  and  it  would  serve  no  useful  purpose  to  contrast  values 
in  the  First  or  Thirteenth  Districts  with  like  property  in  the 
Third,  Ninth  or  Twelfth  Districts. 

The  sale  values  per  acre  are  at  wide  variance ;  even  this  state- 
ment will  hold  true  of  front-foot  valuations  on  the  eastern, 
northern  and  western  boundaries  of  Baltimore  City,  and  contrasts 
have  been  attempted  only  within  communities  themselves. 

ROLAND  PARK. 

Roland  Park  is  developed  with  an  unusually  high  grade  of 
houses,  and  building  restrictions  require  the  erection  of  houses 
costing  not  less  than  a  certain  amount;  lots  are  sold  on  the 
square-foot  basis.  No  other  part  of  the  State  compares  with  this 
expensive  and  high-grade  development. 

Ten  houses  were  selected  at  random  and  the  assessments 
averaged.  These  ten  showed  an  averaged  assessment  on  lots  of 
$2,476.50,  with  improvements  assessed  at  the  average  valuation  of 
$6,080.  Selection  was  then  made  of  ten  of  the  best  homes  in 
the  park  and  tax  valuations  showed  an  average  assessment  on 
lots  of  $5,957.50,  with  an  average  assessment  on  improvements  of 
$12,015.  One  of  the  handsomest  homes  in  the  park,  included  in 
this  average,  cost  $40,000  to  build  and  is  assessed  at  $9,000. 

GREEN  SPRING  VALLEY. 

Assessments  of  land  in  the  Green  Spring  Valley  vary  greatly. 
In  the  most  attractive  part  some  land  is  assessed  at  $25  an  acre, 
some  at  $150  an  acre,  and  to  the  west,  with  like  elevation,  some 
are  assessed  at  $300  an  acre.  One  of  the  most  desirable  tracts, 
of  about  50  acres,  has  recently  been  sold  at  $600  an  acre — it  is 
assessed  at  $100  an  acre. 


County  Reports  91 

Ten  pieces  of  property  adjoining,  or  practically  adjoining  each 
other  were  examined  for  purposes  of  comparing  assessments,  with 
the  following  result : 

One  tract  at $90.00  an  acre. 

••       •• 25.00  "  •• 

''       •• 300.00  '•  •• 

"       " 200.00  ••  •• 

"       ••          40.00  ••  " 

•'       •• 150.00  ••  •• 

•^       " 40.00  ■•  '• 

•'     •• 100.00  ••     •• 

200.00    "       •• 

300.00    ••       •• 

Total  number  of  acres  in  these  tracts  was  1,137.  and  the  aggre- 
gate assessment  was  $125,765.  This  produces  an  average  assess- 
ment of  $110.60  per  acre.  The  average  value  of  this  property 
was  between  $300  and  $600  an  acre. 

FARMS. 

In  parts  of  Baltimore  County  farms  are  often  sold  at  low 
figures — lower,  in  fact,  per  acre  than  many  farms  on  the  Eastern 
Shore  of  Maryland.  In  the  Sixth  District,  assessments  varied 
from  $7  per  acre  to  $25  per  acre,  the  highest  for  farm  land  in 
this  district.  Buildings  are  assessed  low — some  barns  being  as- 
sessed at  $25.  Twenty  farms  in  this  district,  all  under  100  acres 
each,  had  an  average  assessment  per  acre  of  $17.66.  with  aver- 
aged assessed  valuation  on  improvements  of  $541.  The  average 
size  of  the  farms  examined  w^as  47^2  acres.  (3f  those  over  100 
acres,  the  average  assessment  per  acre  was  $15.93  ;  averaged  valu- 
ation on  improvements,  $810.     They  averaged   131  lo  acres. 

ADJOINING  COUNTIES. 

Comparison  has  been  made  of  properties  lying  partly  in  Balti- 
more City  and  partly  in  Baltimore  County,  and  in  comparison  of 
properties  on  both  division  lines  there  has  been  eliminated  prop- 
erties wath  valuable  fronts,  either  of  which  would  necessitate  a 
contrast  of  values  between  the  two  portions  which  would  not  be 
fair. 


92  Report  of  the  Commission 

The  following  illustrates  the  contrast  of  the  two  assessments, 
the  figures  in  the  top  line  representing  per  acre  the  property  in 
Baltimore  County,  and  the  amounts  in  the  lower  line  the  assess- 
ment per  acre  of  part  of  the  same  tracts  lying  in  Baltimore  City : 


-Per  Acre.- 


-> 


Baltimore  County  Assessment...  $500    $400    $250    $1,000    $1,500       $400 
Baltimore  City  Assessment 800      500      850      1,200      4,000*     1,000 

*Assessment  made  at  the  front-foot  valuation. 

The  following  shows  contrast  between  Baltimore  County  and 

Carroll  County : 

r Per  Acre. ^ 

Baltimore  County  Assessment $40  $25  $30  $30 

Carroll  County 30  Zi  32  50 

SECURITIES  AT  THE  THIRTY-CENT  LOCAL  RATE. 

Aggregate  value  of  this  class  of  property  in  Baltimore  County 
is  $44,384,410,  which  seems  extremely  high  on  a  per  capita  basis 
when  compared  to  per  capita  assessments  in  other  parts  of  the 
State.  It  must  be  remembered,  however,  that  a  large  number  of 
men  of  means  of  Baltimore  City  have  their  legal  residences  in 
Baltimore  County. 

It  is  impossible  to  approximate  what  percentage  of  securities 
is  assessed. 

PERSONAL  PROPERTY. 

Personal  property  was  classified  by  the  Board  of  County  Com- 
missioners at  the  time  of  re-assessment,  but  no  allowance  made 
for  dift'erences  as  to  grade.  There  are  very  few  assessments  on 
farming  machinery  over  $300.  Furniture  is  assessed  more  often 
to  the  occupiers  of  suburban  homes  than  to  occupiers  of  farms. 
Live  stock  on  farms  is  assessed  without  reference  to  grade  and 
no  dotibt  much  of  it  escapes  taxation.  In  Roland  Park,  assess- 
ments of  furniture  were  noticed  that  would  deserve  investiga- 
tion. In  one  case,  the  owner  was  assessed  for  $6,000  worth  of 
furniture,  while  the  house  in  which  this  furniture  was  contained 
was  assessed' at  $9,000.  In  another  case,  the  owner  was  as- 
sessed for  $7,000  worth  of  furniture  and  the  house  assessed  at 
$9,000.  To  all  appearances,  either  the  furniture  is  over-assessed 
or  the. houses  greatly  under-valued. 


County  Reports  93 

IMPROVED  ROADS. 

The  entire  State  appropriation  for  Baltimore  County  for  roads 
from  the  State  loan  funds  of  1908,  1910  and  1912  has  been 
spent  on  the  turnpikes  or  main  arteries  from  Baltimore  City  into 
the  county — namely,  Harford,  Belair,  Frederick,  York,  Falls, 
Philadelphia,  Park  Heights,  Liberty  and  Westport  roads.  It  is 
doubtful  whether  the  improvement  of  these  roads  has  increased 
the  value  of  property  as  have  new  roads  elsew^here  in  the  State. 

RAILROAD  ASSESSMENT. 

Railroads  are  valued  by  the  Board  of  County  Commissioners 
and  are  assessed  to  each  district.  Quadruple  tracks  are  assessed 
at  $40,000  a  mile,  double  tracks  at  $25,000  a  mile,  single  tracks 
generally  at  $10,000  a  mile.  The  double  tracks  of  the  Western 
Maryland  Railway,  however,  are  assessed  at  $15,000  a  mile  in 
the  Fourth  District,  while  in  the  Third  District  they  are  assessed 
at  $25,000  a  mile.  Sidings  are  assessed  at  $5,000  a  mile,  with 
some  exceptions.  The  railroad  assessment  in  nearly  every  case 
includes  land,  bridges,  .telegraph  lines  and  signals. 

DISTRICT  ASSESSMENTS.* 

Real  and 
District.  Personal  Property. 

1 $10,757,683 

2 ; 2,450,878 

3 13.949,881 

4 4,525,151 

5 1,204,095 

6 1,051,870 

7 1,862,120 

8 5.782,253 

9 21,745,455 

10 2,087,976 

11 3,403,400 

12 18,047,155 

13 6,682,570 

14 5,332,815 

15 7,076,430 

$105,959,732 

Securities   (30-cent  rate) 44.384,410 

Railroad  property  subject  to  local  rate.  .  .  6,473,503 

Baltimore  City  stock 496,090 

Shares  of  Marjdand  Corporations 13,500,000 

$170.813.7,10 

^Assessment  of  all  items  for   1913. 


94  Report  of  the  Commission 

CALVERT  COUNTY. 

Calvert  is  the  smallest  county  in  the  State,  both  in  respect  to 
area  and  population.  Its  situation  on  the  western  shore  of  the 
Chesapeake  Bay,  together  with  its  being  bounded  on  the  south- 
west by  the  Patuxent  River,  gives  it  a  large  waterfront-  area. 
Unfortunately,  however,  for  property  values,  the  one  railroad 
which  passes  through  the  county  touches  only  its  extreme 
northern  edge,  so  that  facilities  for  transportation  are  extremely 
meagre. 

Calvert  County  has  an  area  of  216  square  miles  and  a  popula- 
tion of  slightly  over  10.000.  which  has  shown  little  tendency  to 
increase.  The  taxable  basis  of  the  county  is  slightly  over 
$3,000,000,  which  represents  an  increase  of  about  $600,000,  due 
to  the  reassessment  of  1910.  Since  1877  the  entire  increase  in 
the  assessable  basis  has  amounted  to  only  25  per  cent. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

While  the  assessment  throughout  the  county  is  not  uniform,  its 
general  average  percentage  to  actual  value  is  not  far  from  70  per 
cent.  A  fairly  exact  confirmation  of  this  percentage  is  difficult 
to  obtain  due  to  the  fact  that  the  County  Commissioners  in  many 
cases  increase  their  assessment  on  transferred  property  to  con- 
form to  the  consideration  set  out  in  the  deed.  In  other  words, 
where  property  has  been  transferred,  and  the  purchase  price  set 
out  in  the  deed,  an  investigation  will  usually  disclose  that  the 
property  is  assessed  at  an  amount  similar  to  the  transfer  price. 

In  some  cases,  however,  where  the  County  Commissioners 
were  of  the  opinion  that  the  purchase  price  set  forth  in  the  deed 
was  considerably  more  than  the  real  value  of  the  property,  the 
full  increased  assessment  has  not  been  made.  In  one  instance, 
v;here  certain  waterfront  property  which  was  assessed  at  $3,300 
was  sold  for  $8,500.  the  Commissioners  reached  a  reassessment 
of  the  property  by  taking  one-third  of  the  difference  between  as- 
sessment and  sale  price  and  adding  it  to  the  original  assessment, 
which  resulted  in  a  final  assessment  of  $5,033. 

Despite  variations  of  this  character  and  some  lack  of  uni- 
formitv  even  in  the  asses.sment  of  adjoining  farms,  the  general 


COUNTV   RKI'dKTS  95 

average  assessment  for  the  county  is  about  70  per  cent,  of  the 
actual  value. 

ASSESSMENTS  AND  SALE  PRICES. 

There  are  comparatively  few  transfers  in  Calvert  County  in 
which  the  consideration  is  given.  The  assessments  in  the  present 
table  represent  those  on  the  books  at  the  time  of  the  sale.  Most 
of  them  have  now  been  increased  up  to  the  amount  of  the  sale 
price. 

Assessment.  Sale  Price. 

District   No.   1 $2,240  (87  Acres)  $4,700 

811  (80  Acres)  1,200 

1,170  (24  Acres)  2,250 

3.000  (Town  Property)  5.000 

1.000  (Solomon's  Island)  1,600 

3,300  (100  Acres)  8,500 

District   No.  2 350  400 

2,456  3,000 


$14,327  $26,650 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

No  distinction  is  made  on  the  assessment  books  between  arable 
and  wood  land.  Marshland  is  separately  assessed.  Much  of  the 
waterfront  land  is  assessed  at  $25  an  acre,  though  there  is  one 
small  tract  upon  which  the  assessment  is  $50  an  acre.  Woodland 
is  usually  assessed  at  from  $4  to  $8  an  acre  and  marshland  at  $2. 
The  assessment  on  interior  land  is  often  as  high  as  its  actual 
value,  while  waterfront  land  is  assessed  at  a  much  lower  per- 
centage. The  following  table  showing  the  average  assessment 
for  twenty-five  consecutive  farms  gives  a  good  idea  of  the  assess- 
m.ent  value  prevailing  throughout  the  county : 


No.  of 

Total 

Assessed 

Average 

Farms. 

Acres. 

Value. 

per  Acre. 

High. 

Low. 

25 

3,423 

$27,096 

$7  91 

$20     • 

$4 

ASSESSMENT. 

The  only  two  incorporated  towns  within  the  county  are  Chesa- 
peake Beach  and  North  Chesapeake  Beach.  Although  in  the 
Third  District,  they  are  kept  separate  on  the  books.     The  assess- 


96  Report  of  the  Commission 

nient  of  these  towns  is  on  the  lot  basis.  Some  of  the  town 
assessments  have  been  considered  too  high  by  the  County  Com- 
missioners and  recent  reductions  in  these  assessments  have  been 
made. 

PERSONAL  PROPERTY. 

There  are  no  regular  assessors  except  the  County  Commis- 
sioners, and  it  is  impossible  to  form  any  estimate  of  how  much 
personal  property  is  missed.  The  increase  in  this  class  of  assess- 
ment depends  entirely  on  the  County  Commissioners,  which 
necessarily  results  in  a  lack  of  uniformity.  Live  stock  is  assessed 
separately  and  usually  according  to  certain  predetermined  values 
which  may  be  termed  list  prices.  Horses  are  assessed  from  540 
to  $75,  cows  at  $20,  sheep  at  $3  and  hogs  at  $4. 

SECURITIES  AT  TPIE  THIRTY-CENT  RATE. 

There  are  no  returns  of  securities  in  the  county  taxed  at  the 
30-cent  rate.  According  to  the  County  Commissioners,  this  is  due 
to  the  fact  that  none  of  this  class  of  securities  are  held  in  the 
county. 

Railroad  Assessments. 

The  Chesapeake  Beach  Railroad,  the  only  one  within  the  county, 
i.'  assessed  at  $3,000  a  mile. 

DISTRICT  ASSESSMENTS. 

REAL    AND    PERSONAL. 

L.... $1,050,256  00 

2 831,926  00 

3 1,200,880  00 


$3,083,062  00 


County  Reports  •  97 

CAROLINE  COUNTY. 

With  the  exception  of  Talbot  and  Kent,  Caroline  County  is  the 
smallest  of  the  counties  composing  the  Eastern  Shore.  It  has  an 
area  of  317  square  miles  and  a  population  closely  approximating 
20,000.  There  are  seven  incorporated  towns  within  the  county, 
Denton,  the  county  seat,  being  the  most  important. 

Caroline  County  lies  wholly  inland,  and  has  therefore  entirely 
missed  any  increase  in  wealth  due  to  the  recent  advances  in  the 
value  of  waterfront  property.  On  the  other  hand,  the  adaptability 
of  its  land  and  location  for  the  purposes  of  truck  farming  has 
caused  a  notable  increase  both  in  the  value  of  land  and  in  the 
number  of  residents  within  the  county.  In  regard  to  this  latter 
feature,  the  population  of  Caroline  County  increased  from  16,000 
in  1900  to  19,000  in  1910,  while  many  of  the  neighboring  coun- 
ties were  suffering  a  decrease.  The  stability  of  its  values  for 
truck  farming  development  seems  certain,  and  further  increases 
in  the  total  value  of  land  throughout  the  county  are  steadily 
tn.king  place. 

The  assessed  basis  of  the  county  for  1912  was  $10,069,636; 
$4,136,000  of  this  amount  represented  the  increase  due  to  the  re- 
assessment of  1910.  With  the  sole  exception  of  Dorchester,  this 
is  the  largest  increase  made  by  any  of  the  Eastern  Shore  counties, 
or  indeed  any  county  of  the  State. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

The  general  basis  of  assessment  in  Caroline  County  is  far  from 
uniform,  and  it  is,  therefore,  difficult  to  arrive  at  an  accurate  es- 
timate of  the  average  difference  throughout  the  county  between 
assessment  and  true  value.  The  treasurer  of  the  county  is  of  the 
opinion  that  the  variations  between  assessment  and  true  value 
range  from  50  to  90  per  cent.,  with  a  general  average  of  75  per 
cent,  for  the  county.  Although  there  is  some  opinion  to  the  ef- 
fect that  the  average  assessment  is  two-thirds  of  the  true  value 
rather  than  three-fourths,  an  opinion  which  is  well  supported  by 
the  total  figures  of  the  actual  examples  contained  herewith,  yet 
it  seems  proper  to  accept  the  75  per  cent,  average  as  being  more 
nearly  correct  in  the  aggregate.     Assessments  of  adjoining  prop- 


98  Report  of  the  Commission 

erty  in  Caroline  and  Talbot  Counties  show  a  higher  range  of  as- 
sessment in  the  former  county  and  despite  the  great  lack  of  uni- 
formity pointing  to  any  certain  conclusion,  yet  general  indications 
support  the  inference  that  assessments  throughout  Caroline 
County  average  at  least  5  per  cent,  higher  than  those  throughout 
Talbot.  The  tax  officers  in  Talbot  County  also  bear  out  the  fact 
that  the  assessments  in  Caroline  County  are  higher  than  their 
own. 

ASSESSMENTS  AND  SALE  PRICES. 

Actual  examples  of  the  differences  between  assessments  and 
sale  prices  are  somewhat  difficult  to  obtain,  but  the  following 
examples  of  recent  transfers  are  typical  for  the  county.  As 
mentioned  before,  the  dift'erence  between  the  respective  totals  rep- 
resents a  difference  of  about  65  per  cent.,  although  the  general 
average  for  the  county  may  be  10  per  cent,  higher: 

Assessment.  Sale  Price. 

District  No.  3 $2,425  (81  Acres)  $2,450 

District  No.  5 900  1,150 

3,975  (235  Acres)  5,000 

2,160  (69  Acres)  3,450 

1,200  (35  Acres)  2,000 

2,900  (76  Acres)  4,000 

District  No.  7 1,050  (50  Acres)  1,575 

3,000  (72  Acres)  5,415 

3,220  (84  Acres)  6,000 

Total  Assessment $20,830    Total  Sale  Price,  $31,040 

ASSESSED  \\'\LUE  OF  LAND  PER  ACRE. 

In  variance  to  the  practice  of  adjoining  counties,  farms  in 
Caroline  are  assessed  as  a  whole,  no  division  being  made  in  each 
farm  between  arable  land  and  wood  land.  The  lack  of  such  di- 
vision militates  against  exactness  in  assessment  and  separate 
farms  vary  greatly  as  to  their  assessment  per  acre. 

In  the  report  of  the  County  Commissioners,  the  highest  assess- 
ment of  farmland  per  acre  is  given  as  $75,  but  for  all  practical 
purposes  $50  per  acre  is  the  highest  assessment  for  any  consider- 
able acreage.  The  general  average  assessment  of  farmland  is 
said  to  be  $25  an  acre,  though  it  is  probably  somewhat  less  than 
this. 


County  Reports  99 

The  following  tables  show  averages  of  the  assessments  of 
farmland  in  two  districts  of  Caroline  County.  District  No.  1 
contains  some  of  the  poorer  land  of  the  county,  while  the  land 
in  District  No.  6  is  extremely  good: 

DISTRICT   No.   1. 

Total             Total  Average 

No.  of  Farms.           Acres.  Assessments,  per  Acre.  High.  Low. 

33  (25  A.  to  100  A.) . . .     1,853           $29,887  $16  13  $30  $8 

18  (100  A.  up) 3,077             46,249  15  03  25  8 

DISTRICT   No.   6. 

Total  Total  Average 

No.  of  Farms.          Acres.  Assessments,  per  Acre.  High.  Low. 

19  (25  A.  to  100  A.)..     1,114           $34,884  $3131  $50  $10 
31  (25  A.  up) 5,647           202,119             35  79             50  18 

TOWN  ASSESSMENTS. 

Town  assessments  for  local  purposes  are  considerably  higher 
than  those  made  by  the  county,  due  for  the  most  part,  it  is  said, 
to  the  provisions  of  municipal  charters.  Town  property  is  not 
kept  separately  upon  the  assessment  books,  so  the  differences  are 
rot  readily  apparent.  Assessments  are  made  on  the  front-foot 
basis.  In  the  smaller  towns,  such  as  Hillsboro,  the  assessments 
are  at  the  rate  of  $5  per  front  foot.  In  Denton,  the  county  seat, 
the  highest  assessment  is  $20  per  front  foot. 

PERSONAL  PROPERTY. 

Household  goods,  live  stock  and  other  forms  of  personalty 
seem  to  be  carefully  assessed,  though  in  respect  to  household 
goods  probably  at  not  more  than  one-half  of  their  value.  The 
average  assessable  value  of  horses  is  placed  at  $100,  cows  at  $25, 
and  automobiles  $500.  Much  of  the  taxes  due  upon  personalty 
is  said  to  be  lost  through  owners  leaving  the  county. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

There  are  no  securities  taxed  within  the  county  at  the  30-cent 
rate,  the  opportunity  for  securing  income  from  this  source  being 
entirely  neglected. 


100  Report  of  the  Commission 

RAILROAD  ASSESSMENTS. 

The  Delaware  R.  R.  (Pennsylvania)  is  assessed  at  the  rate,  ap- 
proximately, of  $4,000  a  mile.  This  assessment  includes  lands, 
bridges,  telegraph  and  telephone  lines,  wires,  signals  and  appur- 
tenances. 

Side  track  is  assessed  at  the  rate  of  $1,800  a  mile. 

DISTRICT    ASSESSMENTS. 

Real  and  Personal  Property   (Not  Separated). 

District  No.  1 $815,217        District  No.  6 $1,322,054 

District  No.  2 1,532,642        District  No.  7 1,343,085 

District  No.  3 2,276,690        District  No.  8 869,066 

District  No.  4 1,335,261  

District  No.  5 1,246,681  $10,740,696 


County  Reports  101 

CARROLL  COUNTY. 

The  local  rate  of  taxation  per  $100  in  Carroll  County  is  the 
lowest  in  the  State  (viz — 62  cents  for  1912),  and  has  been  low  for 
years;  for  many  years  it  was  under  50  cents.  It  is  a  very 
prosperous  county  and  its  per  capita  wealth  compares  favorably 
with  any.  The  aggregate  of  its  savings  deposits  is  very  large, 
and  not  one  district  is  poor  or  ill-adapted  to  agriculture.  It  is 
rich  in  dairy  products. 

Equity  sales  or  forced  sales  under  decrees  of  court  are  rare, 
and  the  cases  examined  in  the  Circuit  Court  had  peculiar  cir- 
cumstances, and  consequently  are  not  cited. 

The  following  were  the  last  sales  of  property  by  executors 
under  orders  of  the  Orphans'  Court : 

Acres.                            District.  Assessment.  Sales. 

36 8  $1,498  00  $1,947  56 

65 11  6,380  00  6,459  68 

45 7  4,750  00  7,520  00 

140 12  7,775  00  9,105  07 

218 1  10,370  00  12,477  00 

56 4  2,206  00  4,000  00 

35 6  960  00  1,900  00 

88* 4  3,714  00  8,500  00 

72 4  3,322  00  6,350  00 

A  few  private  sales,  quite  recent,  are  submitted. 

7  $10,833  00  $18,000  00 

Lot 1  2,400  00  2,400  00 

QVi 12  4,460  00  5,750  00 

Lot 7  2,750  00  t2,800  00 

90% 14  2,850  00  6,000  00 

88 1  4,920  00  5,850  00 

(n 6  2,708  00  5,010  00 

$71,896  00  $104,069  31 

DISTRICT  ASSESSMENT. 

Some  properties  in  the  county  are  assessed  at  their  full  value 
not  looking  to  a  forced  sale,  while  other  and  possibly  adjoining 
properties  are  assessed  much  below  their  value.  Improvements 
are  assessed  low,  especially  farm  improvements;  these  are  very 
large  and  extensive  throughout  the  county  and  the  pride  of  the 
farmers. 


*Sale  of  property  on  new  State  road. 
tSale  of  one-half. 


102  Report  of  the  Commission 

Immediately  prior  to  the  last  reassessment  the  assessors  who 
were  appointed  met  and  discussed  methods  of  assessment,  but  it 
seems  that  no  thorough  instruction  was  given  nor  any  comprehen- 
sive plan  outlined. 

It  appears  as  though  an  effort  was  made  to  reach  satisfactory 
results,  but  the  individuals  were  not  experts  and  had  to  use  their 
judgment  without  a  comparative  guide.  Quite  a  few  of  the  ap- 
praisements were  lowered  from  the  appraiser's  returns,  and  none 
increased. 

A  few  comparisons  were  made  of  property  under  the  1896  and 
1910  assessments.  The  properties  were  familiar  to  the  persons 
suggesting  the  particular  properties,  and  in  some  cases  the  land 
was  higher  with  a  deduction  in  the  improvements,  and  in  others 
the  land  was  lower  with  the  increase  on  the  improvements. 
Values,  though,  had  actually  increased. 

The  properties  of  the  districts  vary  little  in  value,  with  a  slight 
advantage  to  those  properties  adjoining  Frederick  County.  New 
Windsor  is  probably  the  best  district. 

Ten  farms,  all  over  100  acres,  in  this  district  averaged  an 
assessment  of  $40.03  per  acre  on  the  land,  and  averaged  in  size 
139  acres  with  average  assessed  improvements  of  $1,970.  Ten 
farms,  all  under  100  acres,  in  the  same  district,  averaged  $42.33 
an  acre,  and  in  size  76  acres,  while  the  improvements  averaged 
$1,995. 

From  the  information  obtained,  the  land  was  worth  $80.00  to 
$100.00  improved,  which  would  make  the  assessment  less  than 
two-thirds  of  the  value.  The  assessments  throughout  the  district 
vary  from  $30.00  to  $52.00  per  acre. 

The  poorest  district  is  Freedom,  in  the  southeast  corner  of  the 
county,  with  assessments  varying  from  $10.00  to  $28.00.  Ten 
farms  in  this  district,  all  over  100  acres,  have  an  average  assess- 
ment of  $20.40  per  acre,  and  $1,325  for  improvements,  with  an 
average  area  of  143.5  acres. 

Of  ten  farms,  all  under  100  acres  each,  the  average  land  assess- 
ment per  acre  is  $18.50,  and  average  improvement  of  $887.50,  and 
average  size  of  63  acres. 

Assessors  in  this  county  arbitrarily  estimated  farms  of  over 
200  acres  to  be  worth  per  acre  $5.00  less  than  small  properties. 


County  Reports  103 

Carroll  has  the  smallest  percentage  of  wooded  area  of  any 
county  in  the  State ;  its  wood  has  never  been  appraised  according 
to  age  and  condition  by  competent  assessors.  The  assessment  on 
such  lots  was  about  $16.00  per  acre. 

The  loss  of  $2,100,000  of  taxable  basis  in  1912  from  1911  was 
largely  because  of  the  decision  of  the  Circuit  Court  holding  that 
savings  bank  deposits  were  not  properly  taxable  to  depositors. ^ 

The  tax-gatherers  or  collectors  are  the  permanent  assessors  and 
receive  $1.50  for  every  $1,000  added.  They  never  reassess,  but 
add  new  buildings  and  missed  personal  property. 

ADJOINING  COUNTIES. 

At  the  time  of  the  last  reassessment  several  persons  holding 
property  lying  partly  in  Carroll  County  and  partly  in  Frederick 
County  objected  to  the  County  Commissioners  that  their  Carroll 
County  holdings  were  being  assessed  about  three  times  as  high  as 
similar  property  in  Frederick  County.  Assessments  in  Carroll 
along  the  line  are  about  $45.00  to  $48.00  an  acre  in  its  best  parts. 

Some  property  in  Hampstead  District  bordering  on  Baltimore 
County  is  assessed  as  high  as  $50.00  per  acre,  others  at  $24.00, 
some  at  $30.00 ;  along  the  Howard  County  line  the  property  varies 
from  $10.00  to  $40.00  per  acre. 

STOCKS  AND  BONDS  AT  THE  THIRTY-CENT  RATE. 

The  aggregate  assessment  of  securities  in  the  county  for  1912, 
as  furnished  by  the  County  Commissioners,  is  $2,177,802. 

In  this  aggregate  is  included  notes  of  firms  and  individuals, 
assessed  at  the  ratio  fixed  by  Section  194  of  the  Acts  of  1896, 
ch.  120. 

Those  bearing  6  per  cent,  interest  are  assessed  at  50  per  cent, 
of  face  value;  those  5  per  cent,  at  41%  per  cent.;  those  4^^  per 
cent,  at  Ziy^  per  cent. ;  those  4  per  cent,  at  33%  per  cent. ;  those 
3>4  per  cent,  at  29%  per  cent. 


1  See  Eck  vs.  Co.  Com.  of  Carroll  Co.— Daily  Record,  October  26,  1911. 


104  Report  of  the  Commission 

PERSONAL  PROPERTY. 

Furniture  is  fairly  assessed  to  occupiers  of  the  homes  in  the 
towns,  particularly  in  the  larger  towns,  but  not  so  generally  in 
the  smaller  ones  or  country  territory.     The  aggregates  are  low. 

Horses  are  assessed  from  $80  to  $100  and  very  poor  ones  (or 
as  described  by  the  County  Commissioners — those  that  the  owners 
are  keeping  to  die — )  not  at  all.     Cows  from  $25.00  to  $35.00. 

There  are  a  few  assessments  against  individuals  in  this  county 
for  farm  machinery  where  the  value  is  over  $300.00,  which 
amount  is  the  exemption  allowed  by  Art.  81,  Sec.  4. 

Carroll  County  is  one  of  the  few  counties  which  has  assessment 
against  this  class  of  property. 

TOWN  ASSESSMENT. 

Westminster,  the  county  seat,  has  an  assessment  for  local  pur- 
poses of  $3,667,765,  and  is  the  same  as  the  county  or  State  assess- 
ment, although  formerly  when  there  was  a  limitation  on  the  tax 
rate  in  the  town,  the  assessment  for  local  taxes  was  taken  from 
the  county  books  and  a  percentage  added.  The  best  part  of 
Main  street  is  assessed  at  $100  per  front  foot,  which  is  approxi- 
mately the  value.  The  buildings,  however,  are  assessed  much 
below  the  value;  a  few  cases  of  sales  show  marked  contrast  be- 
tween sales  price  and  assessment. 

There  are  seven  other  towns  in  the  county  of  nearly  the  same 
size. 

Properties  in  Union  Bridge  and  New  Windsor  are  assessed  on 
the  front  foot  basis.     The  best  street  in  Union  Bridge  is  assessed 
at  $15.00  per  front  foot,  and  the  best  in  New  Windsor  at  $6.00 
The  value  is  about  the  same.     Comparison  of  others  is  impossible, 
because  the  assessment  is  by  lot  method. 

IMPROVED  ROADS. 

In  the  opinion  of  the  best  posted  men  in  the  county,  improved 
roads  have  increased  the  value  of  large  farms  adjoining  them 
from  20  to  30  per  cent,  and  smaller  properties  40  per  cent. 


County  Reports 


105 


Examination  of  sale  values  before  and  after  completion  of  the 
roads  would  seem  to  indicate  a  much  greater  increase,  but  cir- 
cumstances controlling  these  sales  seem  to  deserve  closer  con- 
sideration than  was  afforded. 

There  is  no  change  whatever  in  the  taxable  basis  of  properties 
abutting  on  these  roads. 

RAILROAD  ASSESSMENT. 

Railroads  are  assessed  to  each  district. 

The  Western  Maryland  Railroad  is  assessed  at  $7,500  per  mile 
main  track,  and  $1,500  a  mile  for  sidings,  and  the  York,  Hanover 
and  Frederick  Railroad  Company  at  $6,000  a  mile. 

The  assessment  includes  land,  bridges,  telegraph  etc.,  although 
it  is  claimed  by  some  that  the  land  constituting  the  right  of  way 
is  not  owned  by  the  railroad  companies,  and  is  assessed  in  part  to 
the  owners  of  the  fee.     The  truth  of  this  claim  was  not  verified. 

DISTRICT  ASSESSMENTS. 


District. 

Taneytown    1 

Uniontown    2 

Myers   3 

Woolery's    4 

Freedom    5 

Manchester  6 

Westminster    7 

Hampstead    8 

Franklin  9 

Middleburg  10 

New  Windsor 11 

Union  Bridge 12 

Mt.  Airy 13 

Berrett   14 


Securities, 

Real  and 

30-Cent 

Personal. 

Rate. 

Total. 

$2,100,292 

$117,640 

$2,217,932 

1,483,778 

169,470 

1,563,248 

1,295,874 

59,234 

1,355,108 

1,475,510 

2,7,Z70 

1,512,880 

1,098,024 

91,200 

1,189,224 

1,950,188 

108,476 

2,058,664 

4,217,387 

766,681 

4,984,068 

1,379,754 

50,007 

1.429,761 

664,970 

10,745 

675,715 

978,950 

263,487 

1,242,437 

1,625,703 

255,165 

1,880,868 

1,214,835 

162,167 

1,377,002 

714,005 

48,030 

762,035 

896,611 

38,130 

934,741 

Stock  of  Corporations. 
Total   assessment. 


$23,273,683 
.     2,977,061 

.$26,250,744 


106  Report  of  the  Commission 

CECIL  COUNTY. 

Cecil  County  lies  in  the  extreme  northeast  portion  of  the  State 
at  the  head  of  the  Chesapeake  Bay.  It  has  a  population  of  ap- 
proximately 24,000,  of  which  less  than  3,500  are  negroes.  In 
size  it  is  larger  than  Kent  County,  to  which  it  is  contiguous  on 
the  south,  but  smaller  than  Harford  County,  which  lies  directly 
adjacent  to  it  on  the  west,  separated  only  by  the  Susquehanna 
River. 

Cecil  County  has  an  assessed  basis  of  $15,500,000,  less  than 
$1,200,000  of  which  was  an  increase  due  to  the  general  reassess- 
ment of  1910.  The  basis  of  the  county  has  only  increased  17  per 
cent,  since  the  assessment  of  1877.  The  amount  of  this  increase 
is,  with  the  sole  exception  of  Frederick  County,  the  smallest 
recorded  in  the  State. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

The  percentage  of  assessment  to  true  value  throughout  the 
county  is  far  from  uniform.  Different  districts  are  apparently 
assessed  at  varying  percentages  of  their  true  value.  District  No. 
8,  for  instance,  is  assessed  much  lower  on  a  general  average  than 
Districts  1,  2  and  3.  In  the  districts  themselves  much  discrepancy 
prevails.  In  most  cases  the  valuation  placed  upon  property  by 
the  owner  was  accepted  as  correct.  While  the  prevailing  lack  of 
uniformity  prevents  any  wholly  satisfactory  percentage  of  assess- 
ment to  valuation  being  found,  yet  the  evidence  strongly  points  to 
the  conclusion  that  66%  per  cent,  is  the  proper  average  for  the 
county  as  a  whole.  Not  only  do  certain  of  the  tax  officers  of  the 
county  consider  this  as  the  correct  percentage  of  the  true  value 
assessed,  but  the  totals  of  the  following  concrete  examples  con- 
firm this  percentage  as  the  proper  one. 

ASSESSMENTS  AND  SALE  PRICES. 

The  following  actual  examples  of  the  differences  between  as- 
sessments and  sale  prices  are  taken  from  the  county  records. 
The  lack  of  uniformity  in  assessed  value  is  strikingly  shown: 


County  Reports  107 

Assessment.  Sale  Price. 

District  No.  2 $1,000  ( Rising  Sun)  $3,000 

District  No.  4 1.100  (56  Acres)  2,500 

District  No.  5 850  (56  Acres)  1,850 

400  1,500 

District  No.  6 2,970  (102  Acres)  5,000 

1,780  (70  Acres)  4,100 

2,465  (53  Acres)  3,200 

District  No.  9 12,555  (362  Acres)  15,000 


Total  Assessment $23,120  Total  Sale  Price,    $36,150 

VALUE  OF  LAND  PER  ACRE. 

The  highest  assessment  of  farmland  within  the  county  is  at  the 
rate  of  $40  an  acre,  although  the  average  is  probably  below  $25. 
In  Rising  Sun,  District  No.  6,  much  of  the  best  farmland  is  as- 
sessed at  from  $25  to  $30  an  acre.  The  average  market  value  of 
this  land  runs  from  $50  to  $80  an  acre.  Wood,  arable,  and 
marsh  land  are  all  assessed  separately  and  a  clear  division  of  value 
is  made  on  different  kinds  of  bnd.  ]\Iarshland  is  assessed  at 
from  50  cents  an  acre  up,  and  lowlands  from  $5  to  $15. 

A  good  idea  of  the  average  value  of  farmland  in  the  county 
may  be  obtained  from  the  following  tables.  Both  of  these  tables 
are  based  upon  Chesapeake  District,  which  is  fairly  representative 
of  the  value  of  farmland  throughout  the  county.  In  Table  No.  1 
only  farms  from  25  to  100  acres  are  considered,  in  Table  No.  2 
farms  from  100  acres  up: 

DISTRICT  No.  2  (25  A.  TO  100  A.). 


No.  of 
Farms. 

32 

Total 

Acreage. 

1.658 

Total 
Assessments. 

$23,099 
DISTRICT  No. 

Average 
per  Acre. 

$13  96 
2  (100  A.  UP). 

High. 

$42 

Low. 
$5 

No.  of 
Farms. 

40 

Total 

Acreage. 

8,362 

Total 

Assessments. 

$221,889 

Average 
per  Acre. 

$26  54 

High. 

$35 

Low. 

$5 

TOWN  ASSESS.MENTS. 

There  are  seven  incorporated  towns  in  the  county.  Instead  of 
including  town  property  with  farm  property  in  the  several  dis- 
tricts, as  is  customary  throughout  the  State,  the  towns  are  as- 


108  Report  of  the  Commission 

sessed  separately,  and  it  is  therefore  possible  to  see  at  a  glance 
just  how  much  assessed  property  lies  within  each  respective  town. 
The  following  four  towns  give  a  clear  idea  of  proportionate 
amount  of  real  and  personal  property  held  within  their  corporate 

limits : 

Per  Cent., 
Popu-  Personal 

lation.  Real.  Personal.  Total,     to  Real. 

Elkton    2,600  $1,503,280  $240,355  $1,743,635  15 

Jrort  Deposit 1,300  268,823  83,065  351,888  32 

North  East 400,936  80,965  481,901  20 

Rising   Sun 450  226,541  109,741  336,282  48 

Town  lots  are  assessed  on  the  front-foot  basis.  The  assess- 
ments in  Elkton  run  from  $3  to  $20  a  front  foot. 

PERSONAL  PROPERTY. 

The  assessed  inventories  of  personal  property  have  the  evidence 
of  being  fairly  complete,  although  assessments,  of  course,  do  not 
leveal  the  full  value  of  the  property.  The  usual  assessment  of 
household  property  averages  about  $200.  The  average  taxable 
values  of  horses  is  $50,  cows  $20  and  automobiles  $400.  The 
valuation  is  fixed  by  the  assessors,  who  receive  $1  for  each 
$1,000  of  property  placed  on  the  books.  There  is  supposed  to  be 
one  regular  assessor  for  each  district. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

Compared  to  other  counties  in  the  State,  the  taxable  basis  of 
Cecil  for  1912  contained  a  very  large  amount  of  securities  at  the 
30-cent  rate,  amounting  to  $2,423,290.  About  one-half  of  this 
amount  has  already  been  sworn  of¥  the  books,  but  even  at  the 
present  time  the  amount  of  this  class  of  securities  assessed  in 
Cecil  is  high  compared  to  many  other  counties  of  the  State. 

RAILROAD  ASSESSMENTS. 

Both  the  Philadelphia,  Baltimore  and  Washington  R.  R.  and 
the  Baltimore  and  Ohio  run  through  Cecil  County.     The  assess- 


County  Reports  109 

ments  are  at  the  rate  of  $25,000  a  mile  for  main  line  double  track, 
v\  hich  includes  bridges,  telegraph  and  telephone  lines,  signals  and 
appurtenances.  Single  track  averages  about  $10,000  a  mile  and 
side  tracks  are  assessed  at  $2,500  per  mile. 

DISTRICT  ASSESSMENTS. 

Real.  Personal. 

District  No.  1 $1,540,454  $382,469 

District  No.  2 1,152,136  291,527 

District  No.  3 2,783,555  658,698 

District  No.  4 965,268  170,564 

District  No.  5 1,234,090  253,629 

District  No.  6 1,239,772  310,344 

District  No.  7 2,101,710  314,682 

District  No.  8 452,774  72,768 

District  No.  9 657,928  121,825 


110  Report  of  the  Commission 

CHARLES  COUNTY. 

In  area  Charles  County  ranks  as  the  eighth  largest  county  in 
the  State.  It  is  the  largest  of  the  Western  Shore  counties  and  lies 
almost  directly  south  of  Washington,  D.  C.  Although  no  portion 
of  the  county  borders  on  the  Chesapeake  Bay,  yet  it  contains 
much  undeveloped  waterfront  property  along  the  Potomac  River, 
which  forms  almost  its  entire  western  and  southern  boundaries. 

Despite  its  area  of  462  square  miles,  the  greater  part  of  which 
is  susceptible  to  cultivation,  the  assessed  basis  of  Charles  County 
is  only  $5,500,000,  $1,500,000  of  which  was  an  increase  due  to 
reassessment  of  1910.  The  assessment  basis  of  the  county  seems 
quite  well  maintained,  the  real  cause  why  values  themselves  are 
rot  higher  being  due,  in  a  large  measure,  to  the  small  white  popu- 
lation. Indeed,  Charles  County,  taking  its  area  into  considera- 
tion, contains  the  smallest  percentage  of  white  population  in  the 
State,  the  total,  in  round  numbers,  being  white,  8,000;  negro, 
9,000.  Although  the  negro  population  is  largely  taxpaying,  yet, 
of  course,  the  property  owned  by  the  colored  race  has  not  an  im- 
portant value. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

The  general  basis  of  assessment  for  Charles  County  represents 
somewhere  between  75  and  80  per  cent,  of  the  true  value  of  the 
property.  The  assessment  basis  is  said  to  be  uniform  throughout 
all  of  the  nine  districts  comprising  the  county.  This  uniformity 
IS  due  to  the  fact  that  in  the  reassessment  of  1910  two  general 
assessors  were  appointed  for  the  whole  county  and  these  assessors 
acted  with  the  local  assessor  in  each  district.  Indeed,  the  local 
assessor  did  little  more  than  point  out  the  property  for  the  gen- 
eral assessors  to  value.  The  results  attained  were  so  satisfactory 
to  the  county  that  extremely  small  changes,  aggregating  less  than 
$10,000,  were  made  in  the  assessments  when  they  finally  came 
before  the  County  Commissioners  acting  as  a  Board  of  Control 
and  Review. 


County  Reports 


111 


ASSESSMENTS  AND  SALE  PRICES. 

There  are  not  a  large  number  of  important  real  estate  trans- 
fers in  Charles  County,  and  many  of  the  deeds  only  contain  a 
nominal  consideration. 

However,  the  following  examples  of  the  difference  between  as- 
sessment and  sale  price  adequately  bear  out  the  statement  that 
about  80  per  cent,  of  the  actual  value  is  assessed.  It  should,  how- 
ever, be  noted  that  the  sales  here  given  were  made  almost  two 
years  after  the  assessment,  and  therefore  an  increase  in  value  is 
only  natural : 


District  No.  1 

District  No.  1 

District  No.  1 

District  No.  1 

District  No.  3 

District  No.  3 

District  No.  3 

District  No.  4 

District  No.  5 

District  No.  5 

District  No.  6 

District  No.  8 

Total  Assessment $30,077 


ssessment. 

Acre. 

Sale. 

$125 

Town  Lot 

'      $600 

4,000 

261  Acres 

5,200 

1,800 

97  Acres 

2,500 

1,200 

142  Acres 

*2,500 

3,496 

268  Acres 

4,100 

3,000 

245  Acres 

3,500 

2,000 

136  Acres 

2,300 

1,225 

85  Acres 

1,650 

4,050 

344  Acres 

5.000 

1,270 

12  Acres 

2,000 

2,631 

121  Acres 

3,000 

5,280 

336  Acres 

5,100 

Total  Sale  Price,    $37,450 


ASSESSED  VALUE  OF  LAND  PER  ACRE. 


On  account  of  the  undeveloped  character  of  the  county  the 
value  of  land  per  acre  is  extremely  low,  corresponding,  in  a  large 
measure,  to  the  low  assessments.  The  highest  assessment  of 
farmlands  in  the  county  is  at  the  rate  of  $25  per  acre,  while  the 
average  assessment  is  probably  between  $8  and  $10  an  acre. 

While  marshland  is  assessed  separately,  arable  land  and  wood- 
land are  averaged  together,  and  therefore  the  assessment  per  acre 
of  farmland  is  usually  the  total  value  of  the  whole  land  divided 
by  the  number  of  acres.  It  is  obvious  that  such  a  method  cannot 
be  exact  in  the  long  run.  Moreover,  if  one-half  of  a  fami  of 
100  acres  assessed  at  $10  per  acre  is  transferred,  the  assessment 
of  each  portion  will,  generally  speaking,  still  remain  at  $10  per 
acre,  although  the  half  that  has  been  transferred  may  have  been 


*Land  borders  a  new  State  road. 


112  Report  of  the  Commission 

mostly  arable  land,  while  the  half  which  was  retained  may  have 
been  mostly  woodland.  The  failure  to  separate  woodland  from 
arable  land  is  especially  noteworthy,  for  the  reason  that  practi- 
cally one-half  of  the  county  is  designated  as  woodland.  Only 
one  county  in  the  State,  Garrett,  has  considerably  more  woodland 
than  has  Charles. 

As  is  to  be  expected  in  a  somewhat  sparsely  settled  county, 
the  ownership  of  large  tracts  of  land  is  the  rule.  This  may  be 
well  seen  from  the  large  number  of  acres  appearing  in  the  totals 
of  the  following  tables,  several  tracts  of  more  than  500  acres 
going  to  make  up  the  average  result.  District  No.  1  is  one  of  the 
best  districts  in  the  county  and  contains  the  county  seat.  In  Dis- 
trict No.  2  the  land  is  decidedly  less  valuable: 

DISTRICT   No.   1. 


No.  of 
Farms. 

Total 
Acres. 

Total 
Assessments. 

Average 
per  Acre. 

High. 

Low, 

30 

7,628 

$84,519 
DISTRICT 

$11  08 
No.    2. 

$25 

$6 

No.  of 
Farms. 

Total 
Acres. 

Total 

Assessments. 

Average 
per  Acre. 

High. 

Low, 

25 

5,493 

$37,144 

$6  n 

$10 

$4 

TOWN  ASSESSMENT. 

There  is  only  one  incorporated  town  in  the  county,  viz,  the 
county  seat,  La  Plata.  Its  population  is  not  over  350.  Land  is 
assessed  on  the  lot  basis,  the  best  lots  running  from  $500  to 
$1,000  per  acre.  The  bases  for  local  and  county  purposes  are  the 
same,  the  total  assessment  of  La  Plata  being  $216,647,  of  which 
amount  $148,382  is  charged  to  realty. 

PERSONAL  PROPERTY. 

It  is  said  that  personal  property  in  Charles  County  is  assessed 
at  a  much  lower  rate  than  real  property.  Household  furniture 
seems  to  be  assessed  very  sparingly,  the  average  assessment  on 
this  character  of  property  being  probably  less  than  $100. 

In  regard  to  live  stock  the  assessors  neglected  to  return  the 
separate  number  of  horses,  mules,  etc.,  and  merely  totaled  each 


County  Reports  113 

class  of  animals  together,  returning  the  aggregate  assessment. 
The  result  has  been  to  make  it  impossible  to  trace  the  value  of 
live  stock  when  it  dies  or  is  transferred,  for  the  individual  as- 
sessment against  each  animal  is  unknown.  The  county  officials, 
therefore,  have  to  depend  entirely  upon  the  honesty  of  the  indi- 
vidual taxpayer  to  maintain  this  class  of  personal  assessment. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

Three  of  the  nine  districts  do  not  report  any  securities  at  the 
20-cent  rate.  Of  the  total  amount  of  $243,627  assessed  within 
the  county,  $217,800  is  returned  from  one  district.  Practically 
none  of  this  amount  has  been  sworn  off  the  books  since  the  re- 
assessment of  1910. 

RAILROAD  ASSESSMENTS. 

There  are  two  railroads  running  through  the  county. 

The  Philadelphia,  Baltimore  and  Washington  R.  R.  (Pope's 
Creek  Branch)  is  assessed  at  $7,500  a  mile  for  single  track  and 
$3,750  a  mile  for  sidings. 

The  Washington,  Potomac  and  Chesapeake  R.  R.  is  assessed 
at  $5,000  a  mile. 

The  county's  apportionment  of  rolling  stock  is  $197,485. 

DISTRICT    ASSESSMENTS. 

Real  and  Personal  Prop-  Bonds  at 

erty  Not  Separated.  30  Cents. 

1 $817,000  $217,800 

2 463,030                         

3 487,627  1,000 

4 686.801                          

5 599,738  11,307 

6 629,926  4,000 

7 675,174                         

8 735,798  8,520 

9 308,421  1,000 


$5,403,515  $243,627 


114  Report  of  the  Commission 

DORCHESTER  COUNTY. 

Dorchester  County  is  the  largest  county  of  the  Eastern  Shore 
and  the  fourth  largest  in  the  State.  It  has  an  area  of  573  square 
miles,  and  a  population  of  29,000,  a  little  over  9,000  of  which  is 
regro.  In  respect  to  population  it  also  leads  all  the  Eastern  Shore 
counties.  A  very  considerable  portion  of  its  area  is  composed  of 
marshland,  which  formerly  had  slight  value,  but  has  recently 
undergone  very  profitable  development. 

The  assessed  basis  of  the  county  for  1912  was  $13,100,065,  of 
which  amount  $5,500,000  represented  an  increase  due  to  the  re- 
assessment of  1910.  From  1877  to  1910,  a  period  of  thirty-three 
years,  the  assessed  basis  of  Dorchester  County  increased  only  a 
million  and  a  half  dollars. 

PERCENTAGE  OF  TRUE  VALUE  ASSESSED. 

Assessments  in  Dorchester  County  were  made  fairly  uniform 
in  1910  as  far  as  the  five  assessing  districts  were  concerned,  and 
the  assessments  returned  represented  about  80  or  85  per  cent,  of 
the  true  value  of  the  property.  Indeed,  the  assessment  work  was 
so  thoroughly  done  that  in  a  number  of  instances  the  claim  was 
made  that  the  assessment  was  higher  than  the  value  of  the  prop- 
erty. The  value  of  land  in  Dorchester  County  has,  however,  so 
rapidly  increased  in  the  last  few  years  that  the  assessments  at 
present  only  represent  between  60  and  65  per  cent,  of  the  present 
value  of  the  property. 

ASSESSMENTS  AND  SALE  PRICES. 

The  variation  between  assessed  values  and  the  amounts  actually 
obtained  upon  sale  is  very  well  illustrated  by  the  following 
examples  taken  from  the  latest  records  of  the  county : 

District.  Assessment.  Sale  Price. 

1   $2,528  (173  Acres)  $7,000 

7  3,400  (60  Acres)  6,500 

7  14,700  25,000 

8  5.834  9,200 

8  5,295  (300  Acres)  10,500 

9  5,092  (229  Acres)  7,300 

9  5,130  (147  Acres)  8,000 

9 6  625  10,500 

9  10,025  (300  Acres)  12.500 

9  7,636  (Trustee  Sale)  14,200 

13  •. 34,615  (863  Acres)  57,000 

13  8,700  (200  Acres)  12,000 

14  5.000  7,000 

16  3,940  ( 154  Acres)  9,000 

$118,520  $195,700 


County  Reports  115 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

In  Dorchester  County  the  assessors  for  the  most  part  made  a 
determined  attempt  to  assess  different  kinds  of  land  separately, 
and,  therefore,  in  addition  to  the  usual  division  of  arable  land, 
woodland  and  marshland,  there  are  often  found  such  further 
divisions  as  "cut-down  land"  (land  from  which  the  timber  has 
been  almost  all  cut  off),  "branch  land,"  "swamp  land"  and 
"cripple  land."  The  average  assessment  of  farmland  within  the 
county  is  at  the  rate  of  about  $25  an  acre.  Marshland  is  assessed 
at  from  $2  to  $10  an  acre,  the  average  being  about  $4  or  $5  an 
acre. 

The  following  table  will  show  the  average  assessment  of  some 
of  the  best  farmland  in  the  county: 

HURLOCK,    DISTRICT    15. 

No.  of  Total  Assessed  Average 

Farms.        Acreage.  Value.  per  Acre.  High.  Low. 

28  2,330  $97,115  $41  68  $100  $30 

TOWN  ASSESSMENTS. 

There  are  four  incorporated  towns  in  Dorchester  County,  Cam- 
bridge, the  county  seat,  being  the  only  one  of  considerable  size. 
Town  and  county  assessments  are  not  uniform.  The  present 
town  assessment  of  Cambridge  is  said  to  be  lower  than  that  of 
the  county,  but  town  property  is  not  separately  kept  on  the  county 
books  and  an  exhaustive  search  would  have  to  be  made  to  deter- 
mine the  amount  of  this  difference.  Town  property  is  also  said 
to  be  assessed  much  nearer  its  true  value  than  is  farmland. 

The  highest  assessment  per  front  foot  in  Cambridge  is  $55, 
and  from  this  amount  it  runs  down  to  $3. 

PERSONAL   PROPERTY. 

Personal  property  is  assessed  most  thoroughly,  even  chickens 
at  50  cents  apiece  being  tabulated.     The  average  taxable  values 
of  horses  is  $70,  cows  $20.     Instead  of  assessing  a  new  auto- 
mobile at  value  and  then  changing  the  assessment  each  year  to 


116  Report  of  ihe  Commission 

allow  for  depreciation,  the  county  assesses  60  per  cent,  of  its  cost 
value  during  the  life  of  the  machine. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

There  are  a  little  over  $200,000  worth  of  securities  at  the  30- 
cent  rate  upon  the  books  of  the  county.  It  is  said  that  a  most 
conservative  estimate  of  the  actual  value  of  this  class  of  securi- 
ties in  Dorchester  County  would  be  five  times  this  amount. 

RAILROAD    ASSESSMENTS. 

The  Delaware  R.  R.  is  assessed  $6,000  a  mile  for  single  track 
and  $2,700  a  mile  for  siding. 

The  Baltimore,  Chesapeake  and  Atlantic  R.  R.  is  assessed  at 

the  rate  of  $.^250  ai  mile  for  single  track  and  $1,500  a  mile  for 

siding. 

DISTRICT   ASSESSMENTS. 


Real. 

District  1 $738,318 

2 729,708 

3 475,367 

4 216.780 

5 256.075 

6 143,188 

7 3,787,330 

8 ...  441,408 

9 372,549 

10 152,427 

11 176,879 

12 354,756 

13 410,144 

14 417,019 

15 1,065,186 

16 167,759 

17 306,732 


Stocks  and 

Personal. 

Total. 

Bonds. 

$165,465 

$903,783 

162,057 

891,765 

120,123 

595,490 

80,969 

297,749 

108.656 

364,731 

89,525 

232,713 

952,170 

4.739.500 

$205,124 

139,977 

581,385 

104,341 

476,890 

15,980 

107,497 

259,524 

43.707 

220,586 

69,009 

423,765 

85.478 

495.222 

84.569 

501,588 

210,353 

1.275,539 

60,449 

228,208 

83,791 

390,523 

County  Reports  117 

FREDERICK  COUNTY. 

Frederick  County  is  the  second  largest  county  in  Maryland, 
containing  an  area  of  660  square  miles.  It  is,  and  has  been  for 
years,  one  of  the  richest  counties  in  the  State.  It  ranks  third  in 
regard  to  population,  having  53,000  inhabitants,  about  5,500  of 
whom  are  negroes. 

The  assessed  basis  of  Frederick  County  amounts  in  round  num- 
bers to  $30,000,000,  $6,500,000  of  which  was  due  to  the  reassess- 
ment of  1910.  From  1877  to  1910  the  assessable  basis  of  Fred- 
erick County  decreased  over  $3,000,000,  so  that  the  aggregate 
result  of  the  present  increase  is  slight.  Indeed,  the  total  assessed 
increase  since  1877  amounts  to  only  14  per  cent.,  which  is  lower 
than  that  of  any  other  county  in  the  State. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

Assessments  in  Frederick  County  are  far  from  uniform.  It  is 
said  that  the  assessors  aimed  at  assessing  seven-tenths  of  the 
value  of  property,  but  that  the  result  will  not  average  much  over 
50  per  cent,  of  true  value.  An  estimated  average  of  55  or  60  per 
cent,  for  the  entire  county  will  come  as  fairly  near  being  accurate 
as  the  lack  of  uniformity  among  the  assessments  will  permit. 

This  lack  of  uniformity  is  very  well  evidenced  by  the  fact  that 
the  1910  assessments  in  three  districts  were  not  only  lower  than 
existing  assessments,  but  in  a  great  many  cases  the  valuations 
turned  in  by  the  owners  were  lowered.  The  result  was  so  strik- 
ingly inequitable  that  the  County  Commissioners  were  forced  to 
take  a  hand  in  the  matter  and  increase  the  assessments  so  that  the 
aggregate  for  each  district  would  be  higher  than  the  amount  of 
the  last  existing  assessment. 

SALE    PRICES    AND    ASSESSMENTS. 

The  following  examples  of  the  differences  between  assessments 

and  sale  prices  will  serve  to  illustrate  the  amount  of  true  value 

actually  assessed : 

District.                      Assessment.  Sale  Price. 

Middletown    $6,162  $9,500 

Frederick    4,750  9,500 

Frederick    260  425 

Catoctin    3,140  4.560 

Jefferson    6,400  12,000 

Middletown    3,000  4,375 

Frederick  8,600  17,500 

$32,312  $57,855 


118  Report  of  the  Commission 

ASSESSED  VALUE  OF  FARMLAND. 

There  has  been  some  attempt  to  separate  arable  land  and  wood- 
land on  the  assessment  books,  but  it  has  not  been  carried  out 
uniformly.    Mountain  land  is,  however,  assessed  separately. 

The  best  farmland  in  the  county  is  assessed  at  $60  an  acre. 
This  character  of  land  sells  all  the  way  from  $100  to  $200  an 
acre.  It  is  said  that  large  farms  are  assessed  sometimes  as  low 
as  one-quarter  of  their  value,  while  in  regard  to  smaller  farms 
the  percentage  of  value  assessed  is  much  higher.  Mountain  land 
is  assessed  from  $1  to  $5  an  acre,  most  of  it  at  the  former  figure 

The  following  table  gives  a  clear  idea  of  the  assessed  value  of 
farmland  in  Middletown,  District  No.  3.  This  is  one  of  the  finest 
fcirm  districts  in  Frederick  County: 

MIDDLETOWN,  DISTRICT  No.  3. 

Assessed  Average 

No.  of  Farms.  Acreage.  Value.  per  Acre. 

27  (100  Acres  up) 3,885  $151,077  $38  88 

24  (25  to  100  Acres) 1,285  45.929  35  74 

TOWN  ASSESSMENTS. 

There  are  eight  incorporated  towns  in  Frederick  County,  the 
largest  of  which  is  Frederick  City,  the  county  seat.  The  assess- 
able basis  for  town  and  county  purposes  are  not  the  same  in  all 
cases.  Frederick  City  for  county  purposes  is  assessed  according 
to  the  lot  plan,  while  for  municipal  purposes  it  is  assessed  on  the 
front-foot  basis.  The  assessment  for  municipal  purposes  is 
decidedly  higher  than  for  county  purposes.  All  the  other  towns 
are  assessed  on  a  "lot  basis.  The  general  claim  is  made  that  the 
average  assessment  in  the  towns  is  about  seven-tenths  of  the 
value. 

PERSONAL   PROPERTY. 

On  account  of  the  fact  that  there  are  no  regular  assessors^ 
other  than  the  Board  of  County  Commissioners,  it  is  probable 
that  much  personalty  escapes  assessment.  Horses  are  assessed 
at  $125  and  cows  at  $30. 


County  Reports 


119 


SECURITIES  AT  THE  THIRTY-CENT  RATE. 

Securities  at  the  30-cent  rate  are  reported  to  the  amount  of 
$1,003,738;  $425,298  of  these  are  held  in  District  No.  2,  which 
includes  Frederick  City. 

RAILROAD    ASSESSMENTS. 

The  Baltimore  and  Ohio  Railroad  (Metropolitan  Branch)  is 
as.sessed  $10,000  a  mile  for  single  track  and  $2,500  a  mile  for 
siding. 

The  York,  Hanover  and  Frederick  Railway  Company  is  as- 
sessed $5,000  a  mile  for  single  track. 

The  Western  Maryland  Railroad  is  assessed  at  the  rate  of 
$6,000  a  mile  for  main  track  and  $1,500  a  mile  for  siding. 

DISTRICT   ASSESSMENTS. 


District. 


1. 

2. 

3. 

4. 

5. 

6. 

7. 

8. 

9. 
10. 
11. 
12. 
13. 
14. 
15. 
16. 
17. 
18. 
19. 
20. 
21. 
22. 
23. 
24. 
25. 
26. 


Home  Stock 

Home  Stock 

Real. 

Personal. 

at  15c. 

at  30c. 

$1,346,084 

$253,259 

$164,870 

5,302.791 

.  1,333,068 

$746,6o6 

425,298 

1.444,601 

264.090 

-  11,200 

26,000 

418,498 

92,577 

700 

1.074.535 

292.366 

26,052 

17,025 

343,985 

85,880 

500 

845.609 

157,410 

27,960 

562.462 

122,158 

14,400 

1.143,739 

271,375 

19,420 

397,681 

81,041 

81,825 

911,899 

200,090 

600 

621,356 

101.458 

528,398 

81,116 

70.m 

677,125 

117,527 

2,000 

806,540 

446,486 

46,920 

615,742 

116,477 

12,250 

697,297 

148,654 

18,566 

533.312 

108,796 

464,763 

96,127 

93,7i6 

541,407 

92,139 

476,019 

68,340 

17,566 

674,013 

181,577 

21.390 

376,673 

76,412 

1,000 

383,636 

50.190 

1,000 

810,746 

146,689 

1,666 

982,051 

158,084 

23,775 

$22,980,962 

$5,143,386 

$867,197 

$1,003,738 

Judgments,  $390,297. 

Total :   County  basis,  $30,225,746 ;  State  basis,  $29,205,674. 


120  Report  of  the  Commission 

GARRETT  COUNTY. 

Garrett  County  lies  in  the  extreme  western  portion  of  the  State. 
Although  the  largest  county  of  Maryland,  having  an  area  of  681 
square  miles,  yet  on  account  of  its  rugged  topography  much  of 
it  is  unsuitable  to  cultivation.  It  has  a  population  of  20,000,  not 
more  than  150  of  which  are  negroes.  A  large  part  of  Garrett 
County  was  platted  and  laid  off  into  military  lots  of  50  acres 
each,  which  were  given  to  survivors  of  the  Revolutionary  War. 
The  ease  with  which  this  property  can  be  traced  results  in  the 
fact  that  there  is  little  acreage  which  escapes  assessment. 

The  assessed  basis  of  Garrett  County  is  $10,835,753,  over 
$3,000,000  being  due  to  the  reassessment  of  1910  (which  was  not 
effective  in  Garrett  until  1912).  Since  1877  the  assessable  basis 
of  the  county  has  increased  224  per  cent.,  which  is  a  larger  in- 
crease than  that  made  by  any  other  county  in  the  State. 

PERCENTAGE  OF  ASSESSMENT  TO  VALUE. 

The  assessment  in  Garrett  County  is  said  to  be  fairly  uniform 
for  the  various  districts,  though  fluctuating  considerably  in  re- 
gard to  neighboring  properties.  The  assessors  had  75  per  cent, 
in  mind  when  the  assessments  were  made,  and  the  general 
average  throughout  the  county  is  probably  from  5  per  cent,  to 
10  per  cent,  lower  than  this.  The  assessments  in  Garrett  County 
are,  if  anything,  slightly  higher  than  those  in  Allegany  County. 

SALE  PRICES  AND  ASSESSMENTS. 

The  following  actual  examples  of  assessments  and  sale  prices 
are  taken  from  the  latest  county  records.  The  aggregate  assess- 
ments amount  to  66  per  cent,  of  the  sale  values : 


District  No.  3.  . 

District  No.  5.  . 

District   No.  7.  . 
District  No.  8.  . 

District  No.   10. 
District  No.   14. 


Assessment. 

Sale  Price. 

$2,987 

$3,300 

1,560 

5,000 

4,956 

5,200 

1,384 

2,300 

3,274 

4,000 

2,000 

2,940 

2,085 

5,000 

898- 

3,000 

1,695 

2,400 

1,360 

2,450 

270 

500 

5,350 

6.000 

$27,819  $42,090 


County  Reports  121 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

There  is  no  classification  under  the  head  of  arable  land  on  the 
assessment  books,  but  many  of  the  larger  farms  are  divided  for 
assessment  purposes  and  a  different  assessment  per  acre  placed 
on  each  portion.  Woodland  is  not  assessed  separately.  Farm- 
land is  assessed  from  $8  to  $100  an  acre,  "rough  land"  from  $1 
to  $5  and  "barren  land"  at  $1. 

Coal  lands  are  assessed  at  from  $5  to  $40  per  acre,  the  average 
being  about  $25. 

The  best  farmland  district  is  No.  3.  The  average  assessment 
of  this  farmland  is  shown  by  the  following  table : 

DISTRICT   No.  3. 

No.  of  Total  Total  Average 

Farms.         Acreage.  Value.  per  Acre.  High.  Low- 

31  4,885  $72,526  $14  85  $40  $8 

TOWN  ASSESSMENTS. 

At  variance  with  conditions  in  Allegany  and  other  counties, 
town  property  in  Garrett  County  is  assessed  higher  on  the 
average  than  is  farmland.  This  is  especially  true  in  regard  to 
Mountain  Lake  Park,  where  assessed  and  actual  values  practically 
correspond.  In  Oakland  property  is  assessed  on  a  lot  basis, 
although  this  basis  is  closely  governed  by  the  frontage.  The  most 
valuable  property  in  Oakland  is  assessed  at  v$40  a  front  foot. 

All  the  towns  have  separate  assessments  for  strictly  local  pur- 
poses, but  these  are  said  to  correspond  fairly  well  with  the  as- 
sessments made  by  the  county.  On  the  county  books,  town  as- 
sessments are  not  kept  separate  from  county  property. 

PERSONAL  PROPERTY. 

Personal  property  is  well  classified  and  is  not  assessed  accord- 
ing to  list  prices.  Assessors  receive  $1.50  a  thousand  for  new 
property  placed  on  the  books  and  there  is  one  assessor  in  each 
district.  There  is  not,  it  is  said,  much  personal  property  missed. 
Horses  are  assessed  from  $2  to  $500 ;  cows  at  $30  on  an  average. 


122  Report  of  the  Commission 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

There  are  no  securities  in  the  county  taxed  at  the  30-cent  rate. 
In  explanation  of  this  apparent  omission  it  is  said  that  there  are 
only  a  few  foreign  stocks  and  bonds  held  by  residents  of  the 
county  and  that  these  have  not  been  deemed  sufficient  for 
consideration,  but  are  assessed  as  other  securities  under  ch.  120, 
1896  sec.  194. 

RAILROAD  ASSESSMENTS. 

There  are  two  railroads  in  the  county  upon  which  taxes  are 
levied.  The  Oakland  and  Confluence  Railroad  is  assessed  at 
$4,000  a  mile  for  main  single  track  and  $1,500  a  mile  for  siding. 

The  Western  Maryland  Railroad  is  assessed  $10,000  a  mile  on 
its  main  line  and  $5,000  a  mile  on  siding. 

DISTRICT    ASSESSMENTS. 

Real. 

District  No.  1 ■ $746,349 

2 654,817 

3 913.183 

4 642,837 

5 513,628 

6 321,077 

7 1,262.405 

8 920.082 

9 242,361 

10 649,334 

11 289,735 

12 287,715 

13 489,779 

14 1,410,731 


Personal. 

Total. 

$112,369 

$858,718 

182.765 

837,582 

283,115 

1,196,298 

104.943 

747,780 

136,215 

649,843 

83,199 

404,276 

211.160 

1,473.565 

269,162 

1.189,044 

43,292 

285,653 

114,085 

763,419 

37,592 

327,327 

87,676 

375,391 

119,675 

609,434 

328,608 

1,739,339 

County  Reports  123 

HARFORD    COUNTY. 

Harford  County  lies  along  the  northern  border  of  Maryland, 
being  bounded  on  the  west  by  Baltimore  County  and  on  the  east 
by  the  Susquehanna  River,  which  separates  it  from  Cecil 
County.  It  has  an  area  of  439  square  miles  and  a  population  of 
28,000,  of  which  5,000  is  negro.  The  county  contains  a  large 
amount  of  good  farm  land,  some  of  the  best  of  which  is  in  the 
Deer  Creek  Valley  region. 

The  assessed  basis  of  the  county  is  $17,500,000.00,  of  which 
amount  $4,000,000.00  represents  the  increase  due  to  the  re- 
assessment in  1910. 

PERCENTAGE  OF  TRUE  A'ALUE  ASSESSED. 

The  six  districts  of  the  county  are  said  to  be  uniformly 
assessed  with  the  exception  of  District  No.  2,  in  which  the  assess- 
ment runs  20  or  25  per  cent,  higher  than  elsewhere  in  the 
county.  The  general  average  of  assessment  for  the  entire  county 
represents  about  66  per  cent,  of  its  real  value.  In  the  reassess- 
ment of  1910  there  were  six  special  assessors  employed,  and 
probably  less  than  5  per  cent,  of  their  estimates  of  value  were 
changed  by  the  County  Commissioners.  Between  periods  of  re- 
assessment there  is  no  attempt  whatever  to  place  upon  the  books 
any  increases  in  the  value  of  real  estate.  As  there  are  no 
assessors  of  personal  property,  with  the  exception  of  the  County 
Commissioners,  a  large  part  of  this  also  escapes  taxation  during 
periods  between  reassessments. 

ASSESSMENTS  AND  SALE  PRICES. 

The  following  actual  examples  taken  from  recent  records  con- 
firm the  opinion  that  about  two-thirds  of  actual  value  is  assessed. 

District.  Assessment.  Sale  Price. 

2 $2,247  $4,050 

3 8.640  (300  Acres)  10,000 

3 6,240  (148  Acres)  12.000 

3 1,975  3.325 

3 664  1,050 

4 410  (7  Acres)  1,050 

5 2,880  3,000 

5 6,855  (97  Acres)  10,500 

5 1,250  1.550 

6 900  2,200 

$32,061  $48,725 


124  Report  of  the  Commission 

ASSESSED  VALUE  OF  LAND. 

The  average  assessment  of  good  farm  land  in  Harford  County 
is  at  the  rate  of  $25.00  an  acre.  What  is  said  to  be  the  best 
farm  in  the  county  is  assessed  at  $40.00  an  acre,  although  there 
are  a  few  tracts  of  farm  land  just  outside  of  Belair  which  are 
assessed  as  high  as  $60.00  an  acre. 

Arable  land,  wood  land  and  marsh  land  are  for  the  most  part 
assessed  separately,  although  no  designation  is  placed  on  the 
records  describing  the  character  of  the  several  divisions  of  land. 
In  a  farm  of  150  acres  50  acres  may  be  assessed  at  $25.00  an 
acre,  50  acres  at  $15.00  an  acre,  and  50  acres  at  $10.00  an  acre, 
but  it  is  impossible  to  tell,  other  than  in  a  general  way,  the  nature 
of  these  divisions.  The  only  care  of  the  County  Commissioners 
seems  to  be  to  insure  that  the  total  assessment  on  land  divided 
and  sold  corresponds  to  the  total  assessment  of  the  same  land  as 
a  single  tract. 

The  average  assessed  value  of  good  farm  land  in  Harford 
County  is  well  shown  by  the  following  table,  which  includes  30 
farms  appearing  consecutively  on  the  assessment  books  of  the 
Third  District   (Belair)  : 

THIRD    DISTRICT. 


No.  of 

Total 

Total 

Average 

Farms. 

Average. 

Assessment. 

per  Acre. 

High. 

Low 

30 

4,060 

$104,286 

$25  68 

$60 

$7 

TOWN  ASSESSMENTS. 

Town  assessments  are  uniform  for  municipal  and  county  pur- 
poses. The  assessments  are  made  on  the  square-foot  basis.  As 
town  property  pays  a  different  rate  for  county  purposes  than 
farm  property,  the  total  assessments  are  kept  on  file  in  the  office 
of  the  County  Commissioners. 

PERSONAL  PROPERTY. 

Personal  property  at  times  of  reassessment  is  valued  in  detail. 
The   average  taxable  basis   of   horses   is  $75.00;   cows.   $25.00; 


County  Reports  125 

automobiles,  $400  to  $1,000.  As  previously  mentioned,  there  are 
no  regular  assessors  of  personal  property  in  Harford  County,  and 
the  only  new  assesf^ments  that  are  turned  in  between  periods  of 
reassessment  are  those  which  happen  to  be  made  by  the  County 
Commissioners.  On  tliis  account  there  is,  undoubtedly,  a  very 
large  amount  of  personal  property  which  escapes  taxation. 

SECURITIES  AT  THIRTY-CENT  RATE. 

Securities  at  the  30c.  rate  amount  to  $1,448,564,.  which  is  a 
very  good  showing  compared  to  most  of  the  other  counties  of 
the  State.  There  is  a  definite  effort  to  place  this  class  of  property 
on  the  books,  and  the  results  of  this  effort  have  been  fairly 
satisfactory. 

RAILROAD  ASSESSMENTS. 

The  Baltimore  and  Ohio  Railroad  is  assessed  $25,000  a  mile 
for  double  track  and  $5,000  a  mile  for  siding. 

The  Philadelphia,  Baltimore  and  Washington  Railroad  is  as- 
sessed $25,000  a  mile  for  double  track,  $7,500  a  mile  for  single 
track  and  $5,000  a  mile  for  siding. 

The  Maryland  and  Pennsylvania  Railroad  is  assessed  $8,000  a 
mile  for  single  track  and  $2,000  a  mile  for  siding. 

DISTRICT   ASSESSMENTS. 

Real  and 
District.  Personal. 

1 $2,085,595 

2 3,546,405 

3 3,408,351 

4 2,656,110 

5 2,757,864 

6 2,199,389 


Towns. 

Securities. 

Railroads. 

Totals. 

$533,200 

$524,621 

$2,094,174 

$443,274 

145,884 

569.100 

3,566,463 

645,193 

564,286 

111,095 

4.506.735 

18,250 

19,432 

2,654,928 

117.100 

64,503 

2.810,461 

62,550 

213,175 

2,073,764 

126  Report  of  the  Commission 

HOWARD  COUNTY. 

Howard  County  is  another  one  of  the  counties  of  Maryland 
with  great  variety  or  classes  of  property.  It  is  adjacent  to  Bal- 
timore City  and  many  of  the  owners  of  land  are  engaged  in  busi- 
ness in  Baltimore  City. 

It  is  a  small  county,  with  an  area  of  249  square  miles. 

ASSESSMENT. 

The  following  sales  are  cited,  but  many  of  them  are  fore- 
closures of  mortgages,  which  have  not  been  considered  generally 
in  statements  of  other  counties : 

Acres.  District. 

160 4th 

75 5th 

Lot— Ellicott  City 2nd 

Lot— Ellicott  Citv 2nd 

103 5th 

62 4th 

393 6th 

93 4th 

298 4th 

Lot— ElHcott  Citv 2nd 

8 : 4th 

Total $44,115  $52,136  18 

DISTRICT  ASSESSMENT. 

It  would  appear  as  though  the  assessed  valuation  of  land  is 
more  uniform  than  in  some  other  counties,  and  that  there  are 
not  the  same  extreme  assessments  of  farmland. 

The  best  farms  in  the  county  are  in  the  neighborhood  of 
Clarksville,  or  the  Fifth  District.  The  farms  in  this  territory 
are  mostly  large,  ranging  in  size  from  300  to  500  acres.  The 
farmland  of  the  Third  and  Fourth  Districts  is  also  valuable. 

There  are  no  classifications  of  lands  such  as  arable,  barren  and 
wood  land,  and  farms  are  assessed  throughout  at  a  unit  of  value. 

The  poorest  district  from  a  standpoint  of  farms  is  the  First, 
but  the  assessment  of  part  of  it,  known  as  Lawyers'  Hill,  brings 
the  aggregate  of  assessment  to  a  large  figure.  This  is  a  suburban 
development.  Land  is  assessed  at  Lawyers'  Hill  from  $200  to 
$300  an  acre,  and  some  of  the  improvements  are  assessed  rela- 


Assessment. 

bale. 

$6,325 

$7,000 

1,805 

3,500 

3,100 

2,600 

1,400 

1,430 

3,280 

3.950 

1,665 

3,781  18 

10,075 

6,400 

2,360 

2,000 

12,815 

20,000 

1,090 

1,250 

200 

225 

County  Reports  127 

tively  high.  A  part  of  this  district  is  devoted  to  trucking  and 
these  small  farms  are  assessed  higher  than  other  parts  of  the 
county. 

Ten  farms,  all  under  100  acres,  in  the  First  District  averaged 
an  assessment  of  $38.75  an  acre,  and  had  an  average  assessment 
of  $1,088  on  improvements.     The  average  size  was  57  acres. 

Of  ten  farms  in  this  district,  over  100  acres,  the  average  as- 
sessment was  $31.53  an  acre,  with  average  improvements  of 
$1,602.     The  average  size  was  173  acres. 

Farms  in  the  Fifth  District  were  also  picked  without  selection 
for  the  purpose  of  averaging  assessments.  Ten  farms,  all  under 
100  acres,  had  an  average  assessment  of  $17.78  per  acre,  with 
improvements  assessed  at  the  average  valuation  of  $515.  The 
size  was  63  acres. 

Of  these  ten  farms,  over  100  acres,  the  average  assessment  per 
acre  was  $23.38,  and  improvements  $1,579.  The  average  size 
was  163  acres. 

Improvements  are,  in  part,  assessed  very  low.  In  the  "Hills  of 
Howard  County"  are  some  of  the  finest  country  homes  in  the 
State  of  IMaryland ;  probably  the  finest  "manor"  in  the  State  is 
in  this  county. 

Some  of  the  assessments  on  these  large  properties  are  very 
low,  an  instance  being  noted  of  an  $8,000  assessment  of  a  home 
worth  many  times  this  amount. 

The  largest  assessment  against  any  house  was  $37,000,  and  it 
was  not  by  any  means  against  the  most  valuable  in  the  county. 

The  manner  of  assessing  lots  at  a  minimum  of  $100,  whether 
the  owner  has  one  or  twelve,  is  the  same  as  in  Anne  Arundel 
County. 

The  total  cost  of  assessing  property  last  year  amounted  to 
$250.30.  Assessors  are  paid  $1.50  for  every  $1,000  added  to  the 
taxable  basis  by  their  efforts.  The  reassessment  of  1910  added  38 
per  cent,  to  the  taxable  basis. 

ADJOINING  COUNTIES. 

Two  owners  having  farms  partly  in  Carroll  and  Howard  Coun- 
ties were  examined  for  assessment.  As  far  as  investigation 
availed,  the  portions  are  of  same  value.  As  regards  one  case, 
the  Howard  County  portion  is  assessed  at  $24  an  acre,  while  the 
part  in  Carroll  is  assessed  at  $18. 


128  Report  of  the  Commission 

The  other  shows  an  assessment  in  Howard  of  $25,  in  Carroll 
of  $10. 

SECURITIES    SUBJECT    TO   THE    THIRTY-CENT 

LOCAL   RATE. 

The  aggregate  assessment  against  this  class  of  property  is 
$1,241,087. 

PERSONAL  PROPERTY. 

By  order  of  the  board,  horses  were  listed  at  $50  to  $100,  cows 
at  $25,  brood  sows  at  $15,  heifers  at  $15  and  calves  at  $10.  Auto- 
mobiles were  assessed  arbitrarily  without  reference  to  make  and 
age  at  $400  to  $1,000. 

Often  the  test  of  personal  property  for  assessment  against  per- 
sons who  owned  no  real  estate  was  the  ownership  of  a  piano. 

In  only  one  instance  was  there  a  return  at  the  time  of  the  re- 
assessment under  the  Act  of  1910  of  farming  machinery  over 
$300,  which  is  the  amount  exempted. 

TOWN  ASSESSMENT. 

The  only  incorporated  town  is  EUicott  City.  The  assessment 
for  local  town  purposes  and  State  and  county  purposes  is  the 
same. 

RAILROAD  ASSESSMENT. 

The  only  railroad  in  the  county  is  the  Baltimore  and  Ohio  Rail- 
road, the  Washington  Branch,  being  assessed  at  $20,000  a  mile 
for  double  tracks  and  sidings  at  $5,000  a  mile. 

DISTRICT  ASSESSMENTS. 

Real  and 

Personal.  Securities. 

1.  Elkridge    $1,658,455  $708,450 

2.  EUicott  City 2.338.925  382,769 

3.  West   Friendship 1,508,778  1,080 

4.  Lisbon   1,835,345  84,450 

5  Clarksville    1,306,092  1,500 

6.  Guilford    1,604.495  55,740 

$10,452,090  $1,233,989 


County  Reports  129 

KENT  COUNTY. 

Kent  County  is  the  second  smallest  of  the  Eastern  Shore 
counties,  containing  an  area  of  only  281  square  miles.  It  lies 
almost  due  west  of  Baltimore,  Queen  Anne's  County  forming  its 
southern  and  Cecil  County  its  northern  boundary.  It  has  a 
population  of  17,000,  over  6,000  of  which  is  negro.  There  are 
six  incorporated  towns  within  the  county.  Chestertown,  the 
county  seat,  which  is  the  largest  of  these,  has  a  population  of 
2,850. 

The  assessed  basis  of  Kent  County  is  a  little  over  $10,000,000. 
The  increase  gained  by  the  reassessment  of  1910  was  slightly 
more  than  $1,500,000.  The  greater  portion  of  the  area  of  the 
county  is  splendidly  suited  for  farm  purposes,  especially  the  grow- 
ing of  tomatoes.  There  is  much  waterfront  property  within  the 
county,  for  which  there  is  a  fairly  steady  demand. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

The  assessment  value  of  land  in  Kent  County  seems  to  repre- 
sent about  65  per  cent,  of  its  true  value.  It  is  said  that  the  as- 
sessors had  75  per  cent,  in  mind  when  they  began  the  reassess- 
ment, but  the  total  result  obtained  was  about  10  per  cent,  below 
this  amount.  There  were  two  general  assessors  for  the  whole 
county,  so  that  as  far  as  the  various  districts  are  concerned  their 
work  is  said  to  be  fairly  uniform.  Of  the  nine  assessors  em- 
ployed six  were  farmers,  two  were  mechanics  and  one  worked  in 
an  office. 

ASSESSMENTS  AND  SALE  PRICES. 

The  following  examples  of  the  differences  existing  between 
sale  price  and  assessment  cover  all  of  the  seven  districts  of  the 
county.  The  opinion  of  county  officials  that  65  per  cent,  of  the 
value  is  assessed  is  admirably  confirmed  by  the  fact  that  the  total 
assessment  as  extracted  from  the  records  represents  65.1  per 
cent,  of  the  total  sale  price : 


130  Report  of  the  Commission 

Assessment.  Sale  Price. 

District  No.  1 $10,500  (300  Acres)  $15,000 

4,800  (350  Acres)  6,780 

8,225  (207  Acr's)  12,000 

District  No.  2 5,620  ( 150  Acres)  9,450 

7,735  (220  Acres)  11,000 

District  No.  3 5,000  ( 149  Acres)  8,000 

District  No.  4 2,660  (Chestertown)  3,800 

2,750  (Chestertown)  5,000 

District  No.  5 510  (16  Acres)  1,000 

District  No.  6 12,230  (301  Acres)  18,000 

8.000  (203  Acres)  12,000 

2,500  ( 100  Acres)  3,900 

5,800  (205  Acres)  10,000 

District  No.  7 8,526  (297  Acres)  14,000 

Total   Assessment $84,856        Total  Sale  Price,  $129,930 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

Arable,  wood  and  marsh  land  are  assessed  separately.  The 
highest  assessment  of  farmland  in  the  county  is  $50  an  acre, 
though  the  best  land  is  seldom  assessed  higher  than  $45  an  acre. 
The  average  assessment  of  farmland  is  somewhere  in  the  neigh- 
borhood of  $30  an  acre.  Very  good  farmland  customarily  sells 
for  between  $75  and  $100  an  acre. 

Twenty-five  consecutive  farms  were  taken  in  both  the  Second 
and  the  Sixth  Districts.  The  Second  District  contains  some  of 
the  best  land  in  the  coimty,  while  the  average  of  the  Sixth  Dis- 
trict is  of  a  much  lower  grade. 

DISTRICT  No.  2  (VERY  GOOD  LAND). 


No.  of 

Farms. 

25 

Total                  Total                  Average 
Acreage.        Assessments.          per  Acre.             High. 
5,400               $195,884                $36  27               $45 

■DISTRICT  No.  6  (FAIR  LAND  ONLY). 

Low. 
$25 

No.  of 
Farms. 

25 

Total                  Total                  Average 
Acreage.        Assessments.          per  Acre.             High. 

5,377                $153,580               $26  70               $43 

Low. 
$18 

TOWN  ASSESSMENT. 

The  six  incorporated  towns  in  Kent  County  have  an  aggregate 
assessed  basis  of  $2,195,044,  or  more  than  one-fifth  of  the  value 
of  the  entire  coimty.     The  assessment  is  the  same  for  town  and 


County  Reports  131 

county  purposes,   a  condition   not  usually  met  with   elsewhere. 
Property  is  assessed  on  the  front-foot  basis.     The  highest  assess- 
ments in  Chestertown  are  at  the  rate  of  $125  a  front  foot  and 
from  this  amount  they  run  down  to  $5  a  foot  and  even  less. 
On  the  county  books  town  property  is  not  entered  separately. 

PERSONAL  PROPERTY. 

Personal  property  is  assessed  at  a  somewhat  lower  percentage 
than  realty,  but  on  account  of  the  nature  of  the  property  it  is  not 
possible  to  estimate  this  percentage  with  any  exactness.  The  as- 
sessors, who  are  appointed  by  the  treasurer,  each  year  endeavor 
to  assess  all  new  property,  including  improvements,  but  the 
yearly  aggregate  increase  from  this  line  of  work  is  not  even  suffi- 
cient to  make  up  for  the  insolvents.  The  assessors  are  paid  25 
cents  for  each  assessment. 

Although  there  is  no  fixed  list  value  for  live  stock,  horses  are 
usually  taxed  at  $50,  cows  at  $30,  sheep  and  hogs  at  $5  each; 
$150  seems  to  be  a  somewhat  customary  valuation  for  household 
furniture,  although  numerous  other  valuations  are  recorded. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

Securities  to  the  amount  of  $248,620  are  taxed  at  the  30-cent 
rate.     These  securities  are  not  separately  totaled  for  each  district. 

RAILROAD  ASSESSMENTS. 

The  Delaware  Railroad  (Pennsylvania)  is  assessed  at  $12,000 
a  mile  for  single  track  and  $2,000  a  mile  for  sidings. 

The  rolling  stock  apportioned  to  the  county  by  the  State 
amounts  to  $147,000. 

DISTRICT   ASSESSMENTS. 

Real  and  Personal   (Not  Separated). 

District  No.  1 $2,019,599 

District  No.  2 2,027,851 

District  No.  3 1,335.484 

District  No.  4 1,796,003 

District  No.  5 978,355 

District  No.  6 966,188 

District  No.  7 832,915 


132  Report  of  the  Commission 

MONTGOMERY  COUNTY. 

Montgomery  County  is  the  fifth  largest  in  the  State,  having  an 
area  of  518  square  miles.  It  has  a  population  of  32,000,  over 
9,000  of  which  is  made  up  of  negroes.  Bordering  as  it  does  on 
the  District  of  Columbia,  suburban  land  values  have  greatly  in- 
creased the  assessable  basis  of  the  county.  Splendid  farm  and 
pasture  land  has  also  contributed  a  large  part  toward  making 
Montgomery  one  of  the  richest  counties  of  the  State. 

The  assessed  basis  of  Montgomery  County  for  State  purposes 
for  the  year  1912  was  $19,889,225.  Four  and  one-half  millions 
of  this  amount  represented  an  increase  due  to  the  reassessment 
of  1910.  Since  1877  Montgomery  County  has  increased  its  as- 
sessable basis  140  per  cent.,  being  exceeded  only  in  this  respect 
by  Garrett  County,  Baltimore  County,  Allegany  County  and 
Caroline  County  in  the  order  named. 

PERCENTAGE  OF  TRUE  VALUE  ASSESSED. 

In  their  return  to  the  County  Commissioners  it  is  stated  that 
the  percentage  of  assessment  to  actual  value  in  the  whole  county 
is  about  50  per  cent.  It  seems  probable,  however,  that  this  is 
somewhat  of  an  overestimate  and  that  a  percentage  in  the  neigh- 
borhood of  40  per  cent,  would  be  more  nearly  correct.  Indeed, 
the  actual  records  show  that  assessments  of  one-third  of  actual 
value  are  quite  usual.  The  United  States  Census  Bureau  esti- 
mated the  percentage  of  assessment  to  true  valuation  at  43  per 
cent.  As  this  43  per  cent,  included  buildings,  which  in  Mont- 
gomery are  assessed  proportionately  higher  than  farmland,  the 
proper  percentage  is  doubtless  in  the  neighborhood  of  40  per  cent. 

ASSESSMENTS  AND  SALE  PRICES. 

On  account  of  the  influence  and  activity  of  Washington  real 
estate  dealers  the  actual  sale  price  of  property  seldom  appears  on 
the  transfer  records.     However,  the  following  concrete  examples, 


County  Reports  133 

taken  from  the  latest  records,  are  typical  of  the  variation  between 
assessment  and  actual  sale  price : 


Assessed  value. 

Price  obtained. 

Percentage  as 

$456 

$1,550 

29% 

675 

2,050 

11% 

1,460 

4,175 

35% 

2,400 

6.700 

36% 

3,026 

9,306 

32% 

13,295 

41,000 

32% 

Totals..  $21,312  $64,781  11% 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

Farmlands  are  variously  assessed  from  $12  to  $150  per  acre. 
There  is  no  very  considerable  amount  of  property  assessed  at 
over  $50  an  acre.  Arable  and  wood  land  are  not  separately  as- 
sessed. In  their  report,  the  County  Commissioners  state  that  the 
average  value  of  farmland  for  the  county  is  about  $20.  This 
seems  to  be  a  fair  estimate. 

The  assessed  value  of  90  farms  in  Rockville  District  No.  4 
were  taken,  each  farm  appearing  consecutively  on  the  latest  as- 
sessment records  of  the  county.  In  one-half  of  the  farms  con- 
sidered the  acreage  was  from  25  to  100,  and  in  the  other  half  the 
acreage  began  at  100  and  ran  from  thence  upward  to  the  largest 
tract,  which  contained  347  acres.  The  following  table  will  give  a 
very  good  idea  of  the  assessed  value  of  land  in  Montgomery 
County : 

ROCKVILLE   DISTRICT   No.   4. 

J->  4->  -M 

E  C  C 

<U      .  <U      •  lU      . 

Number  of  ^  6  S)^S)'^^  -J^!^  S^^^ 

Farms.  -J!  ^2.  tt         f^t  ^  V,  u         ^S^u 

Ort  O  >  >  '^  >a3a.  QrtO<  .^rt„ 

H  'r-  <  -<  J  K 

45  (25  A -100)  2,419  $43,240  53.7  $17  87  $5  00  $50  00 
45  (100  A.  up) . .  .  7,950  213,084  176.6  26  80  6  00  50  00 
90  (as  above)  . .  .  -  10,369   256,324   115.2    24  75     5  00    50  00 

TOWN  ASSESSMENTS. 

There  are  twelve  incorporated  towns  in  IMontgomery  County, 
having    an    aggregate    assessed    value    in    the    neighborhood    of 


134  ■      Report  of  the  Commission 

$3,000,000.  The  assessed  basis  of  these  towns  is  the  same  for 
municipal  and  county  purposes. 

Assessments  are  made  on  the  lot  rather  than  on  the  front- foot 
basis.  Some  of  the  property  in  Takoma  Park  is,  however,  as- 
sessed according  to  the  number  of  square  feet. 

From  the  reports  made  by  the  several  towns  in  the  county  it 
would  appear  that  town  property  is  assessed  much  nearer  its  true 
value  than  is  farmland.  One  town.  Glen  Echo,  claims  that  four- 
ffths  of  the  actual  value  is  assessed,  while  several  reports  state 
that  two-thirds  of  the  actual  value  is  assessed. 

PERSONAL  PROPERTY. 

There  is  much  live  stock  within  the  county  and  not  a  little  of 
it  is  said  to  be  missed  by  the  local  assessors.  The  average  tax- 
able value  of  horses  is  $75,  cows  $20,  automobiles  $250. 

The  assessed  value  of  household  furniture  varies  greatly  from 
district  to  district.  In  the  Rockville  District  the  general  varia- 
tion runs  from  $35  to  $800,  while  the  average  assessment  is  in 
the  neighborhood  of  $200. 

Stock  in  trade  is  quite  conservatively  assessed.  This  may  be 
inferred  from  the  following  typical  instances  of  differences  exist- 
ing between  licenses  obtained  and  the  stock  in  trade  actually  as- 
sessed : 

Assessment.  Licensed  For. 
$400  $1,000 

1.250  4,000 

4,000  10,000 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

Every  district  in  Montgomery  County,  except  the  Twelfth,  re- 
ports stocks  and  bonds  at  the  30-cent  rate,  the  aggregate  amount 
totaling  $1,108,865.  District  No.  13,  which  borders  on  Washing- 
ton, contains  the  largest  assessment  on  this  class  of  property. 

RAILROAD  ASSESSMENTS. 

The  Baltimore  and  Ohio  Railroad  is  assessed  at  the  rate  of 
$20,000  a  mile  for  double  track,  $12,500  a  mile  for  single  track 
and  $2,500  a  mile  for  siding. 


County  Reports 


135 


The  Washington  and  Rockville  Railway  Company  (electric)  is 
assessed  at  the  rate  of  $10,000  a  mile.  Five  cars  belonging  to  this 
railroad  are  assessed  at  $4,000  a  car. 

The  Washington  and  Glen  Echo  Railway  (electric)  is  assessed 
£t  the  rate  of  $2,500  a  mile. 


DISTRICT  ASSESSMENTS. 

Real  Personal  Total  Real  Stocks 

District  No.               Estate.  Property,  and  Personal,  and  Bonds. 

1 $726,215  $191,315  $917,530  $28,300 

2 738,205  155,145  893,350  25,550 

3 887,445  196,760  1,084,205  2,000 

4 2.006.970  693,985  2.700,955  149,450 

5 730,575  203,670  934,245  4,850 

6 699,855  146,410  846.265  2,750 

7 4,059,280  342,155  4,401,435  173,250 

8 1,038,045  287,080  1,325,125  300,775 

9 1,163,850  239,880  1,403.730  11,260 

10 508,905  70,485  579.390  1,000 

11 832,050  134,085  966,135  83,770 

12 561,180  120,585  681,765                

13 3,116,470  420,435  3,536,905  325,910 

Totals $17,069,045  $3,201,990  $20,271,035  $1,108,865 

State  Purposes — Totals. 

$16,438,575  $2,505,285  $18,943,860  $945,365 


136  Report  of  the  Commission 

PRINCE  GEORGE'S  COUNTY. 

Prince  George's  County  extends  from  Howard  County  on  the 
north  to  Charles  County  on  the  south,  a  large  portion  of  the 
western  boundary  of  the  county  bordering  on  the  District  of 
Columbia.  It  is  the  seventh  county  of  the  State  in  point  of  area, 
containing  479.6  square  miles.  It  has  a  population  of  over  36,000, 
a  little  less  than  one-third  of  which  is  negro.  While  the  soil  in 
some  of  the  districts  is  excellent,  yet  taken  as  a  whole  the  farm- 
land is  far  less  productive  than  the  more  northern  counties.  The 
county  contains  seven  incorporated  towns,  one  of  which,  Takoma 
Park,  is  shared  with  Montgomery  County.  Upper  Marlboro  is 
the  county  seat. 

The  assessed  basis  of  the  county  is  a  little  over  $16,000,000, 
$3,000,000  of  which  was  an  increase  due  to  the  reassessment  of 
1910. 

PERCENTAGE   OF  TRUE  VALUE  ASSESSED. 

The  percentage  of  true  value  assessed  varies  extremely  from 
district  to  district.  In  some  districts,  such  as  Marlboro,  large 
tracts  of  land  are  assessed  at  less  than  one-fifth  of  their  actual 
value,  while  much  land  in  other  parts  of  the  county  is  assessed 
at  practically  full  value — in  some  cases  even  above  full  value. 
In  addition  to  favoritism,  one  of  the  most  important  factors 
which  contributed  to  this  result  was  the  fact  that  the  returns 
made  by  the  individual  property  holders  as  to  the  value  of  their 
property  were  accepted  without  change.  This  condition  is  strik- 
ingly shown  by  the  schedule  of  returns  of  the  general  assessment 
of  1910.  In  the  Marlboro  District  120  out  of  126  separate 
valuations  placed  on  their  property  by  owners  were  accepted  by 
the  assessors  as  correct  and  entered  on  the  books.  If  this  ratio 
were  borne  out  through  each  district,  it  would  mean  that  nineteen 
out  of  every  twenty  times  the  property  owners'  valuation  was  ac- 
cepted. But  even  if  this  ratio  is  too  high,  a  ratio  of  nine  out  of 
ten  is  said  to  be  fair  by  some  of  the  county  authorities. 

The  necessary  lack  of  uniformity,  resulting  from  the  methods 
just  outlined,  makes  it  somewhat  difficult  to  arrive  at  the  proper 
general  average  percentage  of  assessment  to  true  value,   but  a 


County  Reports  137 

number  of  factors  lead  to  the  belief  that  the  assessed  value  of 
the  entire  county  does  not  represent  more  than  60  per  cent,  of 
its  real  value. 

ASSESSMENTS  AND  SALE  PRICES. 

The  following  examples  taken  from  the  recent  records  of  the 
county  show  actual  instances  of  the  difference  between  assess- 
ments and  sale  prices.  It  will  be  noted  that  in  several  cases  the 
assessment  is  more  than  the  sale  price,  a  condition  which  is  prac- 
tically never  met  with  elsewhere  in  the  State : 

District.  Assessment. 

4  $300  00  (21  Acres) 

5  480  00  (60  Acres) 

5  7,015  00  (467  Acres) 

5  984  00  (113  Acres) 

10            650  00  (Laurel) 

10                    1,500  00  (Laurel) 

12              1,440  00  {2>7  Acres) 

12 935  00  (10  Acres) 

.     $13,304  00  $22,881  00 

ASSESSED  VALUE  OF  LAND. 

The  average  assessment  of  farmland  throughout  the  county  is 
placed  by  the  County  Commissioners  at  $10  an  acre. 

Wood  land  and  arable  land  are  not  usually  separately  assessed. 
Marshland,  however,  is  customarily  separated  from  farmland. 
The  assessments  on  marshland  run  from  $1  to  $4  per  acre. 

Much  land  in  the  Marlboro  District  is  assessed  at  $25,  which 
has  a  market  price  ranging  from  $50  to  $100  an  acre.  The  aver- 
age assessed  value  of  land  in  the  Marlboro  District  is  well  shown 
by  the  following  table,  which  includes  practically  all  the  large 
farms  in  the  district : 


Sale  Price 

$231  00 

750  00 

16,000  00 

800  00 

1,200  00 

1,500  00 

1,200  00 

1,200  00 

MARLBORO    DISTRICT. 

Value 

Total         Total  As-       Assessed 

No.  of  Farms. 

Acreage,     sessed  Value,  per  Acre. 

High. 

Low 

10    (25  A.-lOO  A.).. 

606             $8,733            $14  41 

$25 

$5 

50   (100  A.  up) 

.  .   10,548            199,182             18  40 

25 

5 

138  Report  of  the  Commission 

In  the  Piscataway  District,  which  is  further  to  the  south  and 
lies  partially  along  the  Potomac  River,  the  average  assessment  of 
land  is  still  lower,  as  may  be  seen  from  the  following  table : 

PISCATAWAY    DISTRICT. 

Value 
Total         Total  As-       Assessed 
No.  of  Farms.  Acreage,     sessed  Value,  per  Acre.        High.       Low. 

19  (25  A.-lOO  A.)...     1,022  $11,003  $10  77  $25  $6 

26  (100  A.  up) 4,566  37,913  8  30  14  6 

TOWN  ASSESSMENTS. 

Town  assessments  are  made  on  the  lot  basis,  rather  than  the 
front  foot.  Town  property  is  not  kept  separate  on  the  books  of 
the  county,  which  makes  any  comparison  between  town  and 
county  assessments  impracticable. 

PERSONAL  PROPERTY. 

Personal  property  is  assessed  separately  and  in  some  cases 
quite  fully.  The  average  taxable  value  of  horses  is  $50,  cows 
$15,  automobiles  $300.  Hogs  are  not  assessed.  There  are  three 
regular  assessors  of  personal  property  within  the  county,  but  the 
districts  which  they  must  cover  are  so  large  that  much  personal 
property  necessarily  escapes  taxation.  In  Districts  Nos.  2  and 
16  personalty  is  said  to  be  decidedly  under-assessed. 

SECURITIES  AT  THE  THIRTY-CENT   RATE. 

Prince  George's  County  reports  only  $142,879  worth  of  securi- 
ties at  the  30-cent  rate.  It  is  self-evident  that  this  amount  repre- 
sents an  extremely  small  percentage  of  the  securities  of  this  char- 
acter which  are  held  by  residents  of  the  county. 

RAILROAD  ASSESSMENTS. 

The  Baltimore  and  Ohio  Railroad  is  assessed  $20,000  a  mile 
for  double  track  and  $5,000  a  mile  for  siding. 


County  Reports 


139 


The  Philadelphia,  Baltimore  and  Washington  Railroad  (Pope's 
Creek  Branch)  is  assessed  at  the  rate  of  $5,000  a  mile  for  single 
track  and  $1,800  a  mile  for  siding. 

The  Chesapeake  Beach  Railroad  is  assessed  at  the  rate  of 
$3,000  a  mile  for  both  main  line  single  track  and  siding. 

ASSESSED    VALUE    BY    DISTRICTS. 


District.  Real. 

1 $1,623,960 

2 1,253,632 

3 549,937 

4 479,389 

5 477,128 

6 849,/83 

7 867,358 

8 294,842 

9 315,801 

10 1,335,955 

11 znii^ 

U 562,158 

13 883,074 

14 930,645 

15 491,855 

16 1,662,779 

17 1,592,338 

18 882,349 


Personal. 

Total. 

$89,071 

$1,713,031 

58,185 

1,311,817 

80,297 

630,234 

83,831 

563,220 

110,954 

588,082 

59.324 

909,107 

91,532 

958,890 

58,360 

353,202 

38,450 

354,251 

210,550 

1.546.505 

86,506 

464,276 

70,495 

632,653 

60,450 

943,524 

79,140 

1,009,785 

58,013 

549,868 

123,698 

1,786,477 

140,407 

1,732,745 

63,458 

945.807 

140  Report  of  the  Commission 

* 

QUEEN  ANNE'S  COUNTY.  • 

In  area  Queen  Anne's  County  contains  363  square  miles,  rank- 
ing as  one  of  the  largest  counties  of  the  Eastern  Shore.  In  popu- 
Idtion,  however,  the  county  falls  below  Kent,  its  neighbor  to  the 
rorth,  and  Talbot  and  Caroline  Counties,  which  are  contiguous 
to  the  south.  It  contains  no  large  centre  of  town  population. 
Centreville,  the  county  seat,  contains  less  than  1,500  people  and 
the  other  incorporated  towns  are  quite  small. 

The  assessed  basis  of  the  county  is  slightly  over  $10,000,000, 
less  than  $500,000  of  which  was  added  by  the  general  assessment 
of  1910. 

Although  somewhat  backward,  both  in  regard  to  population  and 
assessed  basis,  the  land  possesses  all  the  fertility  and  richness 
rative  to  the  Eastern  Shore.  Large  farms  are  the  rule  rather 
than  the  exception.  In  this  respect  it  differs  considerably  from 
Caroline  County,  where  the  profits  incident  to  truck  farming  have 
resulted  in  an  important  increase  both  in  land  values  and  in  popu- 
lation. Waterfront  farms  in  Queen  Anne's,  while  in  good  de- 
mand, have  not  yet  reached  the  prices  prevailing  in  Talbot. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

In  the  report  of  the  County  Commissioners  it  is  stated  that  the 
assessed  basis  represents  about  50  per  cent,  of  the  true  value  of 
property  within  the  county.  This  low  percentage  of  assessment 
if  in  rather  striking  contrast  to  neighboring  counties,  which  as- 
sess on  the  average  from  15  to  30  per  cent,  higher.  If  the  as- 
sessed basis  of  both  Queen  Anne's  and  Talbot  Counties  repre- 
sented the  real  value  of  property  in  each,  it  would  mean  that  land 
in  Talbot  is  60  per  cent,  more  valuable  than  that  in  Queen  Anne's. 
While  considerable  difference  at  present  actually  exists,  it  is,  of 
course,  nothing  like  60  per  cent. 

The  extremely  low  character  of  the  assessment  is  directly  at- 
tributable to  the  work  of  the  general  assessors  in  1910.  It  is  said 
that  these  assessors,  all  of  whom  were  farmers,  did  not  possess 
the  training  necessary  for  the  attainment  of  an  equitable  result. 


County  Reports  141 

There  is  a  strong  oi)inion  in  certain  quarters  of  Queen  Anne's 
County  that  the  present  basis  of  assessment  is  not  only  manifestly 
unfair  to  the  adjoining  counties  and  to  the  State,  but  that  it  is 
also  a  decided  detriment  to  the  county  itself.  Instances  are  cited 
where  outside  capital,  not  entirely  familiar  with  local  conditions, 
has  refused  to  purchase  property  upon  making  the  discovery  that 
the  proposed  sale  price  was  several  times  the  assessed  value. 

The  assessment  of  1910  is  also  said  to  be  lacking  in  uniformity, 
although  in  this  respect  the  defect  is  much  less  glaring  than  in 
some  other  counties  which  have  a  much  higher  assessed  basis. 

ASSESSMENTS  AND  SALE  PRICES. 

The  following  actual  examples  taken  from  the  records  of  five 
of  the  seven  districts  comprising  the  county  clearly  show  the 
great  difference  between  sale  prices  and  assessed  value : 

Assessment.  Sale  Price. 

District  No.  1 ?12,000  $25,000 

5,500  15,000 

2,100  (Trustee  sale)  4.680 

7.280  (200  Acres)  12.000 

6,036  (218  Acres)  11,000 

3,564  (140  Acres)  7,040 

District  No.  3 200  (Town  property)  1.500 

9,000  (Mortgage  sale)  14,000 

2,100  (Town  property)  2,700 

District  No.  4 6,200  16,000 

District  No.  5 3,175  5.150 

20,000  45.000 

8,000  (Administrator's  sale)  17,786 

15,810  (435  Acres)  26.000 

District  No.  6 6,483  9,319 

Total  Assessment $107,448  Total  Sale  Price $212,175 

The  above  examples  furnish  excellent  cumulative  evidence  that, 
on  the  average,  not  more  than  50  per  cent,  of  the  actual  value  of 
the  land  is  assessed. 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

Similar  to  the  adjoining  counties,  land  is  usually  divided  into 
three  classes,  viz :  arable  land,  wood  land  and  marsh.  The  gen- 
eral average  assessment  is  stated  to  be  about  $15  per  acre. 


142  Report  of  the  Commission 

The  highest  assessed  valuation  per  acre  of  arable  land  is  $50, 
but  there  are  extremely  few  pieces  of  property  in  the  county  as- 
sessed at  this  rate.  The  highest  average  assessment  for  the  best 
farmland  is  $40  per  acre,  although  the  actual  value  of  the  land  is 
more  than  twice  this  amount. 

The  total  average  of  twenty-five  consecutive  farms,  over  lOO 
acres  each,  serves  as  a  fair  illustration  of  the  actual  assessment 
basis  of  arable  land  in  the  richest  portion  of  Queen  Anne's. 

FIFTH  DISTRICT   (BEST  ARABLE  LAND). 


Total  No. 

Total 

Average  Value 

Acres. 

Assessed  Value. 

per  Acre. 

High. 

Low, 

5,287 

$181,923 

$34  50 

$50 

$22 

In  the  Seventh  District,  in  which  the  arable  land  is  generally 
poorer  than  that  throughout  the  rest  of  the  county,  the  average 
assessment  of  twenty-five  consecutive  farms  of  over  100  acres 
each  (wood  land  and  marsh  not  considered)  is  as  follows: 

SEVENTH    DISTRICT. 

Total  No.  Total  Average 

Acres.  Assessed  Value.         per  Acre.  High.  Low. 

4,210  $89,092  $21  10  $32  50  $10 

Woodland  is  assessed  separately  and  usually  at  from  $5  to  $15 
per  acre.  About  25  per  cent,  of  the  county  is  woodland.  The 
assessment  on  marshland  is  customarily  from  $2  to  $5  per  acre. 

TOWN  ASSESSMENTS. 

There  are  four  incorporated  towns  in  the  county,  the  land  in 
each  one  being  assessed  On  a  lot  rather  than  on  a  front-foot  basis. 
All  of  the  towns  are  comparatively  small,  their  combined  popula- 
tion being  under  2,500. 

Town  and  county  property  are  not  kept  separate  on  the  assess- 
ment books.  Each  town  has  a  separate  assessable  basis  for  local 
purposes,  which  is  considerably  higher  than  the  county  basis. 


County  Reports  143 

PERSONAL  PROPERTY. 

The  1910  assessments  did  not  place  upon  the  books  any  notice- 
able increase  in  the  value  of  personal  property.  New  personalty 
is  supposed  to  be  assessed  each  year.  The  assessors,  of  whom 
there  is  usually  one  in  each  district,  receive  25  cents  for  each  new 
piece  of  property  which  they  place  on  the  books  regardless  of  the 
value  involved.  A  typewritten  list  is  furnished  each  assessor 
which  gives  definite  valuations  for  various  kinds  of  property. 
The  assessor  follows  this  list  closely  irrespective  of  the  special 
character  of  the  property. 

LIST  VALUE  OF  PERSONAL  PROPERTY  IN 
QUEEN  ANNE'S  COUNTY. 

One   horse $100  00 

Horses   50  00 

Stallion    From  $100  00  to  500  00 

Mules  75  00 

Colts  from  one  to  three  years  old 25  00 

Milch   Cows 20  00 

Yearlings   10  00 

Oxen  and   Bulls 25  00 

Sheep    4  00 

Hogs    foi    killing 5  00 

Top  Carriage 40  00 

No-Top  Buggy 25  00 

Farm   Wagon 25  00 

Dearborn  15  00 

Saw   Mills From  $200  00  to  400  00 

Threshing   Engine From  $500  00  to  1,000  00 

Threshing  Wheat From  $200  00  to  500  00 

Power  Corn  Shellers From  $100  00  to  250  00 

Timber  Wheels From    $20  00  to  40  00 

Piano    100  00 

Organ   40  00 

Wheat   Binders 40  00 

Drill    30  00 

Roller  10  00 

Gun    10  00 

Mower    10  00 

Corn  Cutter 15  00 

Stationary  Engine From  $300  00  to  700  00 

Machinery  for  Creamery From  $200  00  to  500  00 

Hand    Separator 50  00 

Gasoline  Engine From  $200  00  to  400  00 

Canoes  From    $20  00  to  75  00 

Steam  Launch From  $100  00  to  500  00 

Automobiles  From  $500  00  to  2,000  00 

bateau From      $5  00  to  15  00 

Bugeye  From  $400  00  to  800  00 

Schooner  From  $600  00  to  1,500  00 


144  Report  of  the  Commission 

The  explanation  of  assessment  of  "one  horse,"  $100;  horses, 
$50,  is  said  to  be  that  the  owner  of  one  horse  is  usually  a  small 
property  owner  who  might  otherwise  entirely  escape  taxation. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

Four  out  of  the  seven  districts  make  no  return  of  any  securi- 
ties at  the  30-cent  rate,  and  of  the  total  of  $313,331  taxed  in  the 
remaining  districts,  $257,840  is  assessed  to  one  woman.  Many 
securities  of  this  class  wore  sworn  off  shortly  after  the  general 
assessment,  and  no  determined  attempt  has  been  made  to  place 
more  of  this  class  of  property  upon  the'  books. 

RAILROAD  ASSESSMENTS. 

The  Maryland,  Delaware  and  Virginia  Railroad,  which  owns 
about  fifty  miles  of  trackage  in  Queen  Anne's,  is  apparently  en- 
tirely unassessed,  with  the  exception  of  a  few  stations,  etc. 
amounting  in  all  to  $7,510.  There  is  also  no  assessment  of  the 
rolling  stock  of  this  road,  although  the  greater  part  of  it  is  en- 
tirely within  the  county. 

The  Delaware  Railroad  (Pennsylvania)  is  assessed  at  approxi- 
mately $6,000  a  mile  for  single  track  and  $2,700  a  mile  for 
sidings. 

DISTRICT   ASSESSMENTS. 

Total  Real  and  Personal        Bonds, 
(Not  Separated).  30c.  Rate. 

First   $1,448,720                      

Second   1,341,082  $7,780 

Third 2,416,975  46,671 

Fourth   971,963                       

Fifth   1,619,792  257,840 

Sixth    1,288,912                       

Seventh    717,019                      


$9,804,463  $312,331 


County  Reports  145 

ST.  MARY'S  COUNTY. 

St.  Mary's  County  is  the  most  southerly  county  of  the  Western 
Shore.  It  is  considerably  smaller  in  area  than  Charles  County, 
which  touches  it  on  the  north,  having  an  area  of  369  square  miles. 
Its  population,  however,  of  17,000  is  one  thousand  larger  than 
that  of  Charles,  and  the  proportion  of  negro  population  is  also 
somewhat  less  than  in  the  latter  county. 

The  assessed  basis  of  the  county,  in  round  numbers,  is 
$5,000,000,  of  which  amount  $1,500,000  is  an  increase  due  to  the 
assessment  of  1910.  The  increase  from  1877  to  1910  was  less 
ti'an  $500,000. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

Seventy  per  cent,  seems  to  fairly  represent  the  general  relation 
between  assessment  and  actual  values  in  St.  Mary's  County. 
This  general  average  percentage  is  far  from  uniform  throughout 
the  county.  This  is  due  to  the  fact  that  interior  land  is,  as  a  rule, 
assessed  almost  up  to  its  real  value  (some  say  beyond  its  value), 
while  waterfront  property  is  assessed  at  much  less  than  its  sell- 
it!g  price.  A  large  part  of  the  land  in  the  interior  of  the  county 
i.s  rough  and  unproductive,  while  there  exists  a  fairly  active  de- 
mand for  waterfront  property.  This  results  in  a  steady  increase 
in  the  value  of  the  latter,  while  the  price  of  land  situated  in  the 
interior  is  more  or  less  stationary,  due  in  an  extent  to  the  lack  of 
facilities  for  transportation. 

ASSESSMENTS  AND  SALE  PRICES. 

Examples  of  the  differences  between  assessments  and  actual 
sale  prices  are  difficult  to  procure,  but  the  following  ten  sales  are 
fairly  illustrative  of  the  actual  differences  existing  between  them : 

Assessment.  Sale  Price. 

District  No    2... $1,050  00  ( 25  Acres)  $1.750  00 

13  40  (  Building  Lot)  OOO  00 

District  No.  3 1 .500  00  2,800  00 

880  00  1400  00 

60  00  ( Building  Lot)  425  00 

District  No    4 1.530  00  (306  Acres)  2.000  00 

District  No.  5 250  00  (2  Acres)  400  00 

District  No    7     3,180  00  ( 136  Acres)  *4.165  00 

District  No    8 1,180  00  (135  Acres)  2.000  00 

3.650  00  (100  Acres)  5,000  00 


$13,293  40  $20,540  00 

•Trustee's  Sale. 


146  Report  of  the  Commission 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

Arable,  wood  and  marsh  land  are  not  assessed  separately,  but 
the  assessment  per  acre  represents  the  supposed  average  value  per 
acre  for  each  entire  tract.  Practically  the  highest  assessment 
per  acre  for  the  county  is  at  the  rate  of  $50,  although  there  is  ex- 
tremely little  assessed  at  this  figure.  Indeed,  there  are  not  very 
many  assessments  which  are  more  than  $25  an  acre.  The  lowest 
assessment  per  acre  is  $5.  The  average  assessment  in  the  less 
valuable  portions  of  the  county,  such  as  Districts  Nos.  4  and  5, 
run  about  $7  or  $8  an  acre. 

The  following  table  shows  the  average  assessment  on  twenty- 
five  farms  situated  in  the  Third  District  of  St.  Mary's  County. 
This  is  a  fairly  average  district  and  is  the  one  in  which  Leonard- 
town  is  situated : 

DISTRICT    No.    3. 


No.  of 

Total 

Assessed 

Average 

Farms. 

Acres. 

Value. 

per  Acre. 

High. 

Low 

25 

3.336 

$37,060 

$11  11 

*$47  50 

$5 

TOWN  ASSESSMENTS. 

The  only  incorporated  town  in  vSt.  Mary's  County  is  Leonard- 
town,  the  county  seat.  Here,  the  assessment,  which  is  on  the  lot 
basis,  is  not  kept  separate  from  that  of  the  Third  Dirtrict  in 
which  it  lies.  The  assessment  for  local  purposes  is  somewhat 
difl:"erent  from  the  county  basis,  but  on  the  main  is  based  on  the 
county  assessment  books. 

PERSONAL  PROPERTY. 

There  are  four  permanent  assessors  in  the  county,  who  receive 
25  cents  for  each  $100  of  personal  property  turned  in,  but  the 
system  is  said  to  be  entirely  unsatisfactory,  and  the  opinion  is 
held  that  any  change  would  be  in  the  nature  of  an  improvement. 

Live  stock  is  assessed  separately.  The  average  assessed  value 
of  horses  is  ^75,  cows  $20,  hogs  $5.  Up  to  the  present  time 
automobiles  have  not  been  assessed  or  taxed. 


*This  represents  an  assessment  on  more  than  100  acres  of  waterfront, 
including  wharf  property.  Tlic  next  highest  assessment  is  at  the  rate  of 
$18  per  acre. 


County  Reports  147 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

In  four  of  the  nine  districts  of  the  county  there  are  assess- 
ments on  stocks  and  bonds  at  the  30-cent  rate,  the  total  amount- 
ing in  1912  to  $88,829.  Recent  abatements  will  bring  the  present 
amount  of  stocks  and  bonds  assessed  within  the  county  to  less 
than  $75,000. 

RAILROAD  ASSESSMENTS. 

There  is  only  five  and  a  half  miles  of  railroad  within  the  county, 
which  is  known  as  the  Southern  Maryland  Railroad  (Washing- 
ton, Potomac  and  Chesapeake  R.  R.).  The  assessment  on  this 
is  at  the  rate  of  $5,000  a  mile.  Five  miles  of  graded  road  on 
which  no  tracks  have  been  laid  is  assessed  at  $1  per  mile.  The 
county  receives  no  tax  on  rolling  stock. 

DISTRICT    ASSESSMENTS. 

CRea:,  and  Personal  Property  Not  Separated.) 

District  No.  1 $650,954 

2 481.612 

3 985.459 

4 550.795 

5 640.488 

6 495.954 

7 548,744 

8 558,032 

9 56.762 

$4,968,800 


148 


Report  of  the  Commission 


SOMERSET  COUNTY. 


Somerset  County  is  the  southernmost  of  all  the  counties  on  the 
Eastern  Shore,  which  borders  on  the  Chesapeake  Bay;  it  has  an 
area  of  328  square  miles.  It  is  the  leading  county  of  the  State 
in  the  crab  industry.  Crisfield,  the  largest  town  of  the  county, 
ships  more  hard  crabs  than  any  other  town  in  the  State,  if  not  in 
the  whole  country,  and  it  is  one  of  the  foremost,  if  not  the  fore- 
most, in  the  shipping  of  soft  crabs. 

Within  recent  years  trucking  industry  has  developed  rapidly 
and  farms  are  in  active  demand.  In  the  inner  part  of  the  county 
are  large  farms.  The  occupation  of  the  people,  inland,  is  entirely 
agricultural. 

The  following  contrasts  are  fairly  typical  of  forced  sales  in 
Somerset  County,  the  selections  being  the  last  ones  made  and  rati- 
fied at  the  time  of  investigation : 

Acres.                      District.  Assessment.  Sale  Price. 

175 Westover  $5,800  $9,000 

(prior   sale  private  $14,000) 

5 St.  Peter's  100  153 

20 Lawson  650  805 

6 Lawson  650  812 

180 East  Princess  Anne  4.600  4,000 

61 East  Princess  Anne  1,080  600 

House  and  lot.  . .  .Crisfield  2,300  2,725 

5 Brinkley  100  300 

7 St.  Peter's  190  300 

House  and  lot.  ...Crisfield  1,800  2,175 

$17,270  $20,870 

The  following  transfers  have  been  compiled  from  private  sales : 

Acres.                  "  District.  Assessment.  Sale  Price. 

2     Westover  $450  $500 

V2 Deal's  Island  290  360 

25     Mt.  Vernon  1,000  1,100 

21/2 Lawson  37  50  75 

25     Mt.  Vernon  500  1,500 

71^ Mt.  Vernon  725  2.250 

11414 Dublin  2,300  3,100 

Lot Crisfield  300  600 

711/2 Westover  1 ,500  2,000 

Marsh Mt.  Vernon  20  398 

Lot Crisfield  50  100 

425     East  Princess  Anne  2.550  10,000 

514 Deal's  Island  275  350 

27     Brinkley  260  600 

10     Brinkley  875  1.350 

250     Mt.  Vernon  8,165  15,000 

$19,297  50  $39,283 


County  Reports  149 

A  few  offers  of  sale  in  the  county  are  submitted,  none  of  which 
were  accepted  by  the  owners.  The  offers  were  made  in  good 
faith  by  responsible  parties. 

Acres.                      District.  Assessment.  Sale  Offer. 

325 West  Princess  Anne           $15,150  $20,000 

100 West  Princess  Anne                7,500  20,000 

365 West  Princess  Anne               8,000  20,000 

525 Westover                                21,500  36,000 

100 East  Princess  Anne                8,965  20,000 

DISTRICT  ASSESSMENT. 

The  contrasts  in  property  value  between  the  different  districts 
are  not  as  marked  as  in  Wicomico  County,  because  the  county  is 
almost  entirely  devoted  to  agriculture.  Land  values  have  in- 
creased immensely,  however,  of  late  years  through  a  large  influx 
of  non-residents.  This  statement  applies  more  to  the  farms  than 
to  the  towns. 

The  extremes  of  assessment  are  greater  than  in  the  adjoining 
counties,  owing  to  local  conditions  that  deserve  a  close  study  for 
explanation. 

For  instance,  some  parts  of  Deal's  Island  are  assessed  as  high 
as  $120.00  an  acre,  which  is  nearer  the  value  than  many  parts  of 
other  districts.  It  is  true  that  the  tracts  are  in  small  parcels  and 
demand  for  them  is  constant. 

The  best  district  in  the  county  is  Brinkley  District,  and  assess- 
ment varies  from  $4.00  per  acre  to  $35.00. 

In  this  district  ten  farms,  all  under  100  acres,  averaged  an 
assessment  of  $18.00  an  acre,  with  an  average  of  39  acres.  Ten 
farms,  over  100  acres,  averaged  $11.00  an  acre,  with  an  average 
area  of  153  acres.  Some  of  the  aggregate  used  for  the  average 
included  improvements. 

Ten  farms,  all  over  100  acres,  in  Mt.  Vernon  District  averaged 
an  assessment  of  $13.00  an  acre  and  averaged  in  size  161  acres; 
while  the  same  number  of  farms,  all  under  100  acres,  averaged 
$20.00  an  acre  assessment  and  size  48  acres  each.  Improvements 
in  no  case  were  included. 

Improvements  in  the  county  are  assessed  very  low,  and  on 
some  of  the  best  farms  in  the  county  with  extensive  improve- 
ments the  assessment  is  nominal  only.     Examination,  however, 


150  Report  of  the  Commission 

showed  spasmodic  instances  of  very  high  assessment  against  some 
improvements. 

There  is  also  great  diversity  in  assessments  against  woodlands, 
some  instances  being  noted  where  there  were  $35.00  an  acre, 
while  others  are  assessed  much  lower.  The  character  of  the 
woodlands  was  not  examined  by  the  investigator.  The  same  dis- 
parity existed  in  assessments  against  marsh,  varying  from  50 
cents  per  acre  to  $3.00  per  acre. 

Somerset  County  was  not  assessed  under  the  provisions  of  the 
reassessment  act  of  1910,  owing  to  the  fact  that  it  had  been 
reassessed  the  i)revious  year. 

ADJOINING  COUNTIES. 

Somerset  County  adjoins  Wicomico  County  on  the  south  and 
Worcester  County  on  the  west. 

In  the  discussion  under  this  head  in  Wicomico  County  in- 
stances of  the  two  counties  are  cited,  showing  that  the  Somerset 
County  side  is  assessed  about  twice  as  high  as  the  Wicomico  side. 

Comparison  with  the  neighboring  county  of  Worcester  is  diffi- 
cult owing  to  the  fact  that  in  the  latter,  land  and  improvements 
are  assessed  together.  In  Somerset,  the  land  in  many  cases  is 
more  than  the  assessed  value  of  both  in  Worcester. 

STOCKS  AND  BONDS  AT  THE  THIRTY  CENT  RATE. 

This  class  of  j^roperty  is  extremely  small  in  amount,  according 
to  assessment,  and  the  aggregate  has  not  been  reported  to  the 
State  Tax  Commissioner  nor  to  this  Commission.  Examination 
shows  but  a  very  few  persons  against  whom  the  assessment  is 
levied,  and  the  only  ones,  large  in  the  aggregate,  were  those  of 
trustees  holding  securities  for  beneficiaries  of  trust  estates. 

PERSONAL  PROPERTY. 

No  information  was  obtained  concerning  the  assessment  against 
vessels,  a  large  number  of  which  are  owned  by  residents  of  the 
county  residing  near  Crisfield,  although  many  efforts  were  made 
to  obtain  such  information. 


County  Reports  151 

Horses  were  classified  at  $25.00,  $50.00,  $75.00,  $100.00  ac- 
cording to  age  and  condition,  and  it  would  appear  as  though  the 
average  approached  $75.00.  Automobiles  were  listed  at  a  very 
low  figure.  In  one  instance  there  was  noted  an  assessment  of  a 
piano  at  $600.00 

Furniture  is  seldom  assessed. 

TOWN  ASSESSMENTS. 

The  county  seat  of  Somerset  County  is  Princess  Anne,  which 
is  a  small  town  of  about  1,100  people.  It  lies  in  two  districts, 
East  Princess  Anne  and  West  Princess  Anne  Districts. 

The  town's  assessment  for  local  purposes  is  $622,000.00,  and 
the  aggregate  of  the  two  districts  is  $2,151,528.  The  authorities 
claim  that  the  municipal  assessment  is  lower  than  the  county  or 
State  assessment. 

Crisfield,  the  largest  town,  lies  in  Crisfield  District,  but  its  cor- 
porate limits  are  not  co-extensive  with  the  limits  of  the  district. 
The  municipal  assessment  is  $1,616,462,  and  the  district  assess- 
ment is  $1,258,965. 

Crisfield  is  assessed  extremely  low. 

The  highest  assessment  noted  per  front  foot  on  Main  street  is 
$20.00,  while  nearly  all  are  at  $10.00. 

In  Princess  Anne,  a  part  of  its  Main  street  is  assessed  as  high 
as  $25.00.  Stores  and  dwellings  on  the  principal  streets  in  Cris- 
field are  as  low  as  $550.00  (including  land),  and  factories  and 
warehouses  (including  land)  are  in  some  cases  not  assessed  at 
more  than  $350.00  The  valuation  would  run  well  into  the 
thousands. 

The  highest  assessment  of  a  dwelling  is  $4,000.00  and 
$12,000.00  would  not  buy  it. 

Locust  street.  Pine  street.  Seventh,  Eighth,  Ninth  and  Twelfth 
streets  carry  a  small  front  foot  assessment. 

Crisfield  is  a  hea\y  item  to  Somerset  County,  and  from  a 
cursory  investigation  is  probably  not  assessed  one-third  of  its 
value. 


152  Report  of  the  Commission 

IMPROVED  ROADS. 

According  to  opinions  of  well-informed  persons  in  the  county, 
the  State  road  from  Princess  Anne  to  Kingston  has  increased  the 
value  of  the  adjoining  property  from  50  per  cent,  to  80  per  cent. 
Sales  before  and  after  completion  would  indicate  a  greater  in- 
crease, but  allowance  must  be  made  for  consideration  not  ap- 
parent to  the  investigator. 

The  improved  roads  have  not  been  the  means  of  increasing 
the  assessment  in  any  one  instance. 

RAILROAD  ASSESSMENT. 

The  railroads  are  assessed  on  the  books  of  the  East  Princess 
Anne  District,  and  the  only  road  in  the  county  is  the  N.  Y..P.&N. 
R.  R.  The  main  track  is  assessed  at  $7,000.00  a  mile  and  second 
track  at  the  same  amount.  Sidings  are  assessed  at  $4,000.00, 
which  are  higher  than  in  the  adjoining  counties.  In  addition, 
the  land  constituting  the  right  of  way  is  assessed  at  $30.00 
per  acre.  The  Crisfield  branch  of  N.  Y.,  P.  &  N.  R.  R.  carries  an 
assessment  of  $5,000.00  for  main  track  and  $4,000.00  for  side 
track. 

Stations  are  separately  assessed. 

COUNTY  ASSESSMENT  BY  DISTRICTS. 

1.  West   Princess   Anne $933,855  00 

2.  St.    Peter's 222,675  00 

3.  Brinklev    856,055  00 

4.  Dublin    638,485  00 

5.  Mt.  Vernon 351,915  00 

6.  Fairmount    390,565  00 

7.  Crisfield 1,258,965  00 

8.  Lawson    495.085  00 

9.  Tangier     91,285  00 

10.  Smith's  Island 74,050  00 

11.  Dames    Quarter 79,005  00 

12.  Asbury    294,675  00 

13.  Westover    555,695  00 

14.  Deal's   Island •  191,600  00 

15.  East  Princess  Aniie 1,217,670  00 

Total $7,651,580  00 


County  Reports  153 

TALBOT  COUNTY. 

Talbot  County  is  one  of  the  most  favorably  situated  counties 
on  the  Chesapeake  Bay.  It  admirably  combines  the  advantages 
of  good  farmland  and  valuable  waterfront  sites.  Although  it  is 
the  smallest  county  of  the  Eastern  Shore,  containing  an  area  of 
only  267  square  miles,  it  has  a  population  of  20,000,  about  7,000 
of  which  is  negro.  Three  of  its  four  incorporated  towns  have  a 
population  of  over  1,000  each. 

The  assessed  basis  of  the  county  is  slightly  over  $12,000,000, 
more  than  $3,000,000  of  which  represents  an  increase  due  to  the 
reassessment  of  1910.  The  amount  of  this  increase  is  not  at  all 
surprising  when  it  is  borne  in  mind  that  for  a  period  of  thirty- 
four  years,  namely,  from  1877  until  the  completion  of  the  last 
general  reassessment,  the  assessable  basis  of  the  county  increased 
only  $900,000,  or  at  the  rate  of  less  than  $30,000  a  year. 

PERCENTAGE  OF  ASSESSMENT  TO  TRUE  VALUE. 

The  general  basis  of  assessment  for  the  county  usually  fluctu- 
ates between  60  per  cent,  and  80  per  cent,  of  the  real  value.  The 
difference  in  the  percentage  of  true  value  assessed  is  not,  as 
might  be  expected,  a  haphazard  one,  for  since  the  general  reas- 
sessment of  1910  the  prevailing  values  throughout  the  county 
have  been  carefully  watched,  and  the  assessments  throughout  the 
several  districts  are  fairly  uniform.  This  difference  in  assess- 
ment arises  almost  entirely  from  the  policy  of  the  county  in  as- 
sessing farmland  upon  the  theory  of  its  actual  income  yield  as  a 
farm.  Now,  real  estate  values,  especially  in  regard  to  salt  water 
farms,  have  doubled  and  tripled  in  the  last  ten  years  due  to  the 
influx  of  Northern  capital.  For  this  reason  there  is  much  farm- 
land which  sells  for  a  higher  price  than  that  which  its  mere  value 
as  a  producing  farm  could  command.  It  is  contended  that  it 
would  not  be  fair  to  assess  farmers  who  have  held  on  to  their 
M^aterfront  farms  at  the  actual  value  of  their  property,  for  this 
in  many  cases  would  practically  result  in  a  forced  sale.  Acting 
on  this  principle,  only  the  true  value  as  farmland  is  sought  to  be 
taxed,  the  actual  market  values  thus  being  treated  as  fictitious. 
In  other  portions  of  the  county,  where  the  conditions  above  re- 


154  Report  of  the  Commission 

cited  do  not  prevail,  the  assessment  runs  np  to  75  per  cent.,  or 
more,  of  the  true  value. 

The  most  careful  consideration  of  the  evidence  at  hand  seems 
to  lead  to  the  conclusion  that,  taken  as  a  whole,  the  assessment 
in  Talbot  County  represents  about  70  per  cent,  of  the  true  value 
of  property.  This  conclusion  is  not  only  closely  borne  out  by 
the  actual  examples  of  differences  between  assessment  and  sale 
price  given  herewith,  but  also  by  the  general  opinion  that  the  as- 
sessed basis  of  the  county  before  the  reassessment  of  1910  repre- 
sented about  50  per  cent,  of  the  true  value.  As  this  former  as- 
sessment amounted  to  $9,048,915,  the  increase  of  $3,141,000 
would  indicate  that  the  present  basis  is  68  per  cent,  of  the  true 
value.  The  average  of  the  following  examples  indicates  a  per- 
centage of  slightly  over  67,  and  therefore  the  70  per  cent,  as  sug- 
gested is  not  likely  to  prove  an  underestimate. 

ASSESSMENTS  AND  SALE  PRICES. 

Actual  examples  of  differences  between  sale  price  and  assess- 
ment taken  from  the  latest  records  are  as  follows : 


District  No.    1 


District  No.  3 


District  No.  4 


District   No.   5 


Assessment. 

Sale  Price. 

$15,500  (291  Acres) 

$30,000 

16,530  (359  Acres) 

24,000 

15,100  (250  Acres) 

22,000 

3,000  (Easton) 

6,200 

5,850  (Easton) 

6,000 

5,450  (208  Acres) 

7,000 

2,350  (Manufacturing  Plant) 

2,250 

5,535  (70  Acres) 

7,350 

5,625  (175  Acres) 

7,000 

2,200  (68  Acres) 

3,000 

12,500  (298  Acres) 

25,500 

5,450  (200  Acres) 

5,950 

7,150  (200  Acres) 

8,800 

1,925  (Town  Lot) 

2,250 

7,260  (170  Acres) 

9,000 

7,630  (176  Acres) 

13,000 

5.100  (141  Acres) 

5,500 

2,025  (26  Acres) 

2,690 

2,680  (155  Acres) 

3,075 

Total  Assessment $128,880  Total  Sale  Price,  $190,565 


County  Reports  155 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

Arable,  wood  and  marsh  land  are  usually  assessed  separately. 
The  best  arable  land  is  assessed  at  $55  an  acre,  while  the  general 
average  for  good  farmland  is  ^33.  Woodland  is  assessed  at  from 
$15  to  $25  per  acre,  with  an  average  assessment  of  about  $20. 
Twenty-nine  per  cent,  of  the  county  is  wooded.  There  is  some 
marshland  which  is  assessed  as  high  as  $10  per  acre,  but  the  vast 
majority  of  it  does  not  run  over  $5. 

A  fair  idea  of  the  assessed  value  of  arable  land  in  the  Easton 
District,  which  contains  some  of  the  best  land  in  the  county,  can 
be  obtained  from  the  following  average  values : 

EASTON  DISTRICT  (100  ACRES  OR  OVER). 


No.  of 

Total 

Assessed 

Average 

Farms. 

Acres. 

Vahie. 

per  Acre. 

High. 

Low. 

42 

7,596 

$304,720 

$40  13 

$55 

$30 

TOWN  ASSESSMENTS. 

There  are  four  incorporated  towns  in  the  county,  viz,  Easton, 
Oxford,  St.  Michaels  and  Trappe.  Town  and  county  property 
are  not  kept  separate  on  the  assessment  books,  and  it  is,  there- 
fore, impossible  to  make  any  exact  comparison  between  the  total 
assessments  for  town  and  county  purposes.  There  is  no  doubt, 
however,  that  the  towns  are  assessed  considerably  higher  for 
town  than  for  county  purposes,  largely  on  account  of  the  fact 
that  charter  provisions  require  that  a  certain  rate  must  not  be  ex- 
ceeded. On  the  other  hand,  the  assessment  itself  can  always  be 
raised  at  will. 

The  highest  assessment  for  town  property  in  Easton  is  at  the 
rate  of  $50  per  front  foot. 

PERSONAL  PROPERTY. 

The  assessment  of  personal  property  in  Talbot  is  a  fairly  con- 
tinuous operation.  This  is  necessarily  the  case,  as  the  County 
Treasurer  has  only  one  assistant  to  help  him  in  this  important 
work.  In  the  position  of  assessor  the  treasurer  recerves  a  yearly 
salary  of  $300.     It  is  said  that  the  various  districts  are  evenly 


156  Report  of  the  Commission 

assessed.  This  statement  is  difficult  to  confirm  for  the  reason 
that  the  personal  property  for  several  districts  is  not  always 
separately  totaled. 

A  typical  assessment  of  personal  property  in  Talbot  is  as 
follows : 

"Household  furniture,  $300;  4  horses,  S400;  4  cows,  $100;  23 
sheep,  $115;  3  carriages,  $110;  1  bicycle,  $10;  farm  implements, 
$300;  motor,  $250."  The  motor  in  this  instance  is  probably  a 
$500  car,  as  it  is  the  practice  to  assess  automobiles  at  one-half 
the  purchase  price. 

SECURITIES  AT   THE   THIRTV-CEXT   RATE. 

Securities  taxed  in  Talbot  at  the  30-cent  rate  amount  to  only 
$560,437.  The  1910  general  assessment  disclosed  twice  this 
amount  of  securities,  but  their  owners  almost  immediately  ap- 
peared before  the  Board  of  County  Commissioners  and  went 
through  the  usual  process  of  swearing  them  off.  It  is  hardly 
necessary  to  add  that  the  half  million  dollars'  worth  of  securities 
on  the  books  is  only  a  small  fraction  of  the  amount  held  in  the 
county.  This  is  a  condition  quite  as  prevalent  throughout  the 
whole  State  as  it  is  in  Talbot  County. 

RAILROAD  ASSESSMENTS. 

The  Delaware  Railroad  (Pennsylvania)  is  assessed  at  $4,500  a 
mile  for  main  track  and  $1,000  a  mile  for  sidings.  The  propor- 
tion of  its  rolling  stock  allotted  to  the  county  is  $113,161. 

The  Baltimore,  Chesapeake  and  Atlantic  Railway  is  also  as- 
sessed at  $4,500  a  mile  for  main  track  (including  wire  lines  and 
bridges).  There  appears  to  be  no  assessment  on  sidings.  The 
assessment  on  rolling  stock  amounts  to  $15,890. 

DISTRICT   ASSESSMENTS. 

Real. 

District   No.    1 $3,550,377 

District   No.   2 

District   No.   3 2,230,520 

District    No.   4 

District    No.    5 


Total 


Personal. 

Total. 

$953,571 
473',S65 

$4,503,948 

1,903,160 

2,704,035 

2,326,320 

932,280 

$12,375,743 

County  Reports  157 

WASHINGTON  COUNTY. 

Washington  County  is  the  fourth  most  populous  county  in  the 
State,  being  exceeded  only  in  this  respect  by  Baltimore  County, 
Allegany  County  and  Frederick  County  in  the  order  named.  Its 
population  of  50,000  being  distributed  over  an  area  of  457  square 
miles  makes  it  more  densely  settled  than  Frederick  County,  to 
which  it  is  immediately  contiguous.  Land  suitable  to  practically 
every  variety  of  purpose  is  found  within  its  borders. 

The  assessable  basis  of  Washington  County  in  1912  was 
$32,689,096,  $10,500,000  of  which  was  the  result  of  the  reassess- 
ment of  1910.  From  1877  to  1910  the  assessable  basis  of  the 
county  increased  only  a  little  over  .$7,000,000.  The  yearly  in- 
creases, aside  from  general  assessments,  are  at  present  chiefly  due 
to  building  operations  on  the  edge  of  Hagerstown. 

PERCENTAGE  OF  ASSESS^IEXT  TO  TRUE  VALUE. 

While  the  general  average  of  the  nine  assessment  districts  is 
fairly  uniform,  yet  this  is  far  from  the  case  in  respect  to  neigh- 
boring and  adjoining  properties.  The  aim  of  the  assessors  seems 
to  have  been  to  assess  75  per  cent,  of  the  true  value,  and  they 
were  more  or  less  successful  in  maintaining  this  average  as  to 
small  property.  When,  however,  large  and  valuable  property  was 
assessed  the  average  dropped  often  to  50  per  cent,  and  even  less. 
The  average  for  the  entire  county  is  probably  60  per  cent. 

The  tax  collector  of  Washington  County  is  the  sole  assessor  of 
rew  property,  and  there  is  no  possible  method  of  ascertaining 
how  much  personal  property  and  new  buildings  are  missed.  It 
is  self-evident,  however,  that  it  is  a  physical  impossibility  for  a 
single  individual,  no  matter  how  competent,  not  only  to  collect 
the  taxes,  but  also  keep  in  touch  with  all  new  buildings  and  per- 
sonalty over  an  area  of  457  square  miles.  Examples  of  the  result 
of  the  lack  of  extra  assessors  may  be  drawn  from  the  differences 
between  assessment  and  sale  price  given  below.  In  two  of  these 
cases,  while  the  deed  called  for  a  house  and  lot,  the  house,  which 
was  probably  recently  built,  had  not  been  assessed  at  all. 


158  Report  of  the  Commission 

ASSESSMENTS  AND  SALE  PRICES. 

Actual  examples  of  the  differences  between  assessments  and 
sale  prices  are  difficult  to  obtain  in  Washington  County,  as  the 
Clerk  of  the  Court  fails  to  send  to  the  County  Commissioners  the 
records  of  the  transfers  of  real  property  as  required  by  law. 
When  property  is  sold  the  County  Commissioners  are,  therefore, 
not  able  to  enter  any  change  on  their  books  until  the  new  owner 
chooses  to  notify  them  of  the  transfer. 

Assessment.  Sale  Price. 

Hagerstown    $1,840  $2,700 

District  No.  9 9.100  16,340 

District  No.  13 2,200  4,700 

Hagerstown    *120  1,800 

Hagerstown    *500  1,400 

District  No.  13 1,260  2,307 

Hagerstown    2,364  2,900 

Funkstown  Pike 1,300  2,000 

Hagerstown    2,500  4.500 

District  No.   13 13,850  22.912 

Total  Assessment $35,034    Total  Sale  Price,    $61,559 


*House  on  property,  but  only  lot  assessed. 

ASSESSED  VALUE  OF  LAND  PER  ACRE. 

Arable  and  wood  land  are,  as  a  rule,  not  assessed  separately. 
There  is  a  great  variety  of  land  the  assessment  running  from  $1 
an  acre  to  $400  an  acre,  the  land  in  the  latter  case  lying  just  on 
the  outskirts  of  Hagerstown.  The  highest  assessment  on  the 
best  farmland  is  at  the  rate  of  $75  an  acre,  which  character  of 
land  would  be  worth  about  $200  an  acre  on  the  market.  Good 
farmland  will  bring  anywhere  from  $90  to  $150  an  acre.  The 
average  assessment  of  this  kind  of  land  is  from  $40  to  $60  an 
acre.  Lower-priced  land  is  assessed  much  more  nearly  its  true 
value  than  are  the  better  grades. 

The  following  table  shows  the  average  assessment  on  twenty- 
five  farms  in  the  Thirteenth  District  of  Washington  County,  a 
district  which  includes  some  of  the  best  farmland  in  the  county : 

DISTRICr   No.   13. 


No.  of 

Total 

Total 

Average 

Farms. 

Acres. 

Assessment. 

per  Acre. 

High. 

Low 

25 

2,784 

$100,870 

$36  23 

$60 

$12 

County  Reports  159 

TOWN  ASSESSMENTS. 

The  assessment  on  town  property  is  much  further  away  from 
its  true  value  than  is  the  assessment  on  farm  property.  The 
reason  for  this  is  that  farm  property  is  comparatively  easy  to 
value,  but  assessors  are  not  sufficiently  familiar  with  town  values, 
ard  especially  the  assessment  of  large  corporate  property. 

The  assessment  in  all  towns  is  upon  the  front-foot  basis.  The 
highest  assessment  of  property  in  Hagerstown  is  at  the  rate  of 
^400  per  front  foot,  while  the  selling  price  per  front  foot  is  as 
high  as  $1,000.  Property  on  the  outskirts  of  the  town  is  assessed 
at  much  more  nearly  its  true  value  than  that  in  the  center  of  the 
city. 

Acre  tracts,  when  divided  up  into  town  lots,  are  reassessed. 

PERSONAL  PROPERTY. 

As  already  stated,  much  personal  property  is  lost  on  account 
of  the  fact  that  the  tax  collector  is  the  sole  assessor  for  the 
county.  This  is  said  to  be  especially  true  in  regard  to  the  per- 
sonal property  of  corporations.  There  are  no  list  prices.  Good 
horses  are  assessed  at  $100  to  $1.^0.     Cows  are  assessed  at  $30. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

The  assessed  value  (1913)  of  securities  at  the  30-cent  rate  is 
$1,808,634,  of  which  amount  $1,400,617  is  accredited  to  six  dis- 
tricts, which  include  Hagerstown.  Fifteen  cents  of  the  30-cent 
rate  goes  to  the  towns,  and  15  cents  to  the  county,  this  being  the 
construction  given  to  the  act  which  reads  "30  cents  for  county 
and  municipal  purposes." 

RAILROAD  ASSESSMENTS. 

There  are  a  number  of  railroads  within  the  county. 

Western  Maryland  Railroad. 

Single  track  is  assessed  at  $6,500  a  mile,  double  track  at 
$10,000  a  mile,  siding  at  $1,500  a  mile. 


160  Report  of  the  Commission 

Cumberland  Valley  Railroad. 

Single  track  is  assessed  variously  at  $6,(X)0  and  $7,000  a  mile, 
and  siding  at  $1,500,  $2,000  and  $5,000. 

Baltimore  &  Ohio  Railroad  (Washington  Co.  Branch). 

Single  track  is  assessed  at  $5,750  a  mile,  siding  at  $1,500. 

Norfolk  &  Western  Railroad. 

Single  track  is  assessed  variously  at  $6,000  and  $7,000  a  mile. 
No  siding  is  Hsted. 

Hagerstown  Railroad  Co. 

The  Hagerstown  Railroad  Co.,  which  owns  and  operates  28.66 
miles  of  electric  car  lines  in  the  county,  is  assessed  at  $85,980,  or 
at  the  rate  of  $3,000  a  mile.  This  assessment  includes  track, 
poles,  wire,  etc. 

The  only  rolling  stock  returned  to  the  county  is  an  assessment 
on  the  Western  Maryland  Railway  amounting  to  $969,348.  This 
return  was  made  in  1911  and  has  not  been  changed  since  that 
time. 

There  are  no  assessments  on  the  rolling  stock  of  the  electric 
road  or  the  other  steam  roads  appearing  upon  the  books  of  the 
county. 

DISTRICT    ASSESSMENTS.* 


1. 
2. 

4. 
5. 
6. 
7. 


9 

10 

11 

12 

13 

14 

15 

16 

18 

19 

20 

23 

Hagerstown 


:al  and  Personal  Prop- 

Stocks and 

erty,  Not  Separated. 

Bonds  at  30c. 

$768,076 

1,551.293 

$85,094 

955.595 

33,783 

946.157 

959.898 

74.963 

864,876 

20,889 

527.418 

675 

893.856 

127,446 

723.792 

7,575 

332,591 

1,350 

813,176 

1,014,114 

8,345 

782,361 

7,415 

379.275 

611,773 

26,229 

643.225 

8.103 

669,529 

5,150 

447,428 

1,000 

718,428 

16,095,536 

1,400,617 

$30,698,397  $1,808,634 


*Districts  3,  17,  21,  22,  24  and  25  are  included  in  Hagerstown. 


County  Reports  161 

WICOMICO  COUNTY. 

Wicomico  County,  one  of  the  lower  Eastern  Shore  counties 
of  Maryland,  has  an  area  of  368  square  miles,  and  has  shown 
within  the  past  ten  years  a  rapid  growth  of  population  and  pros- 
perity, brought  about  largely  by  increased  transportation  facili- 
ties. vSalisbury,  the  county  seat  and  largest  town,  has  several 
manufacturing  plants.  This  is  the  largest  town  on  the  Eastern 
Shore. 

Sales  of  real  estate  under  decrees  in  equity  are  more  frequent 
than  in  Somerset  and  Worcester  Counties,  but  are  small  in 
amount. 

Development  of  real  estate  in  lots  or  small  farms  is  not  un- 
usual, and  tracts  are  diminishing  in  size  rapidly,  especially  in  and 
near  the  town  of  Salisbury,  which  is  growing  rapidly  in  wealth 
and  population. 

The  following  cases  of  sale  under  decrees  are  cited : 

Acres.  District.  Assessment.        Sale  Price. 

58 Willards   $360  00  $935  00 

House  and  Lot Salisbury   3,000  00  6,600  00 

36 Nutters  1,100  00  1,400  00 

Lot Nanticoke 300  00  340  00 

290 Parsons  3,200  00  5,200  00 

176 Tyaskin    1,988  00  3.750  00 

Lots Nanticoke    3,230  00  5,535  00 

8 Trappe    125  00  375  00 

Lot Salisbury   2,660  00  5,000  00 

$15,963  00  $29,135  00 

The  following  private  sales  and  offers  show  a  few  of  the 
recent  transactions  only : 

Acres                                   District.                     Assessment.  Sale  Price. 

190 Salisbury    $5,750  00  $16,000  00 

Lot Salisbury    ( condemnation ) 5,600  00 

Awarded       by       municipality, 

$16,000;   Court's  award 20,000  00 

800 Salisbury   40,000  00  *70,000  00 

House  and  Lot. . .  .Salisbury   2,400  00  5.000  00 

150 Willards   3,000  00  4,000  00 

44 Willards     350  00  750  00 

150 Salisbury    10,200  00  20,000  00 

384 Dennis    3,000  00  t7,680  00 

Nanticoke,  per  acre 15  00  *30  00 


*Offer  refused.     tWithdrawn. 


162  Report  of  the  Commission 

DISTRICT  ASSESSMENTS. 

There  are  fourteen  assessment  districts  in  the  counties,  and 
the  value  of  the  property  varies  greatly.  Near  Salisbury,  farm 
lands  are  valuable  and  property  in  the  districts  adjacent  to  the 
N.  Y.,  P.  &  N.  R.  R.  is  increasing  rapidly  in  value. 

Property  in  the  immediate  vicinity  of  the  county  seat  (Salis- 
bury) is  assessed  $60.00  an  acre  for  the  highest  assessrrwent, 
and  the  best  farm  in  the  entire  county,  which  contains  496  acres, 
carries  an  assessment  of  $50.00  an  acre. 

Improvements  throughout  tile  county  are  assessed  considerably 
nearer  the  value  than  the  lands,  and  more  in  proportion  than 
similar  improvements  in  the  adjoining  counties.  Land,  however, 
is  not  assessed  as  high  as  in  Somerset,  while  the  fact  remains 
that  it  is  more  valuable  and  more  quickly  salable. 

Delmar  District  is  conceded  to  be  assessed  more  equitably  than 
any  other  district,  with  assessments  varying  from  $15.00  to  $40.00 
per  acre. 

Assessments  in  Willards  District  vary  from  $4.00  to  $15.00 
an  acre;  Black  Barren,  from  $6.00  to  $25.00.  Some  tillable 
property  in  Salisbury  District  is  assessed  as  low  as  $5.00  per  acre. 

Ten  farms  of  Quantico  District  averaged  an  assessment  of 
$11.00  per  acre,  with  average  size  of  147  acres.  Improvements 
in  addition. 

Ten  farms  of  Camden  District,  with  an  acreage  of  41  acres 
average  in  size,  show  an  average  assessment  of  $10  per  acre. 
Improvements  in  addition. 

Dennis  District  is  assessed  in  the  aggregate  for  an  amount  less 
than  the  aggregate  of  the  assessment  of  1896. 

Marsh  lands  are  assessed  about  $3.00  per  acre.  The  Board  of 
County  Commissioners  claim  that  timber  land  is  appraised  by 
competent  appraisers ;  the  selling  value  of  timber  is  $5.00  to  $6.00 
per  1,000  foot  stumpage.  It  is  impossible  to  estimate  ratio  of 
assessment  to  valuation  in  the  whole  county,  as  it  appears  that 
some  property  is  assessed  near  the  value,  while  other  is  assessed 
at  such  a  low  fraction  that  estimate  would  be  impossible. 

ADJOINING  COUNTIES. 
Trappe  District  is  separated   from   Somerset  County  by  the 
Wicomico  River,  and  property  along  the  north  or  in  Wicomico 


County  Reports  163 

County  is  assessed  at  varying  figures  of  $15.00  to  $20.00  an  acre, 
while  in  Somerset  County  the  figure  is  about  $30.00  an  acre. 
The  assessment  of  Districts  Nos.  4,  6  and  14,  bordering  on 
Worcester  County,  compares  favorably  with  that  county. 

STOCKS  AND  BONDS  AT  THE  THIRTY-CENT  RATE. 

The  number  of  individuals  against  whom  there  is  any  assess- 
ment is  so  small  as  hardly  to  be  noticed,  and  within  the  last  few 
years  some  additional  ones  have  been  stricken  off  the  books  at  the 
request  of  protestants. 

The  authorities  of  Salisbury  have  not  listed  separately  this 
class  to  the  Commission,  and  the  whole  assessment  in  the  report 
of  the  county  to  the  State  Tax  Commission  is  $1,063,225. 

PERSONAL  PROPERTY. 

There  is  no  attempt  to  list  personal  property  at  a  uniform 
basis.  Securities  on  the  books,  so  called  (consisting  of  notes), 
are  assessed  one-half  of  the  return  value. 

Assessments  against  furniture  are  small. 

Horses  at  the  last  assessment  were  classified  at  $100,  $75,  $50 
and  $25.     Horses  not  considered  worth  $25  were  not  put  on  the 

books. 

TOWN  ASSESSMENT. 

Salisbury  and  Sharpstown  are  the  only  towns  of  consequence 
in  the  county,  Delmar  being  omitted  for  the  reason  that  it  lies 
partly  in  Delaware  and  Maryland,  and  information  from  town 
officials  not  being  satisfactory. 

The  municipal  or  local  assessment  of  Salisbury  is  $5,096,125. 
It  lies  in  three  districts — viz,  Salisbury,  Camden  and  Parsons — 
and  the  aggregate  assessment  of  these  three  districts  for  county 
and  State  purposes  is  $5,317,797.  Salisbury  necessarily  is  a  small 
part  of  these  districts. 

This  town  is  assessed  on  the  front-foot  basis.  Main  street 
is  assessed  at  $80  a  front  foot,  and  not  a  foot  can  be  purchased 
for  $150.  The  highest  assessment  of  Division  street  in  the  down- 
town section  opposite  the  Courthouse  is  $40  per  front  foot,  and 
which  cannot  be  purchased  at  $150. 

In  the  residence  section  the  assessment  per  front  foot  on  the 
same   street   varies    from   $3   to   $20.      Philadelphia   avenue    is 


164  Report  of  the  Commission 

assessed  as  low  as  $2  a  front  foot  in  places;  Poplar  Grove,  $12 
to  $15. 

Near  the  railroad  station  some  instances  of  property  were 
noticed  assessed  on  the  acre  basis,  which  should  carry  a  front- 
foot  basis.  Some  few  factories  and  office  buildings  are  assessed 
a  fractional  part  of  their  value. 

No  report  has  been  received  from  Sharpstow^n. 

IMPROVED  ROADS. 

Improved  roads  have  increased  the  value  of  abutting  property 
from  50  to  150  pef  cent.,  and  property  immediately  adjoining 
such  highways  is  in  great  demand  for  development  purposes  near 
the  towns  and  for  a  small  farm  development  in  outlying  sec- 
tions. The  assessing  officers  claim  an  advance  from  SSYs  to  50 
per  cent,  in  taxable  basis  of  the  property  immediately  abutting 
on  the  improved  roads,  but  examination  does  not  show  a  result 
as  claimed. 

RAILROAD  ASSESSMENT. 

The  N.  Y.,  P.  &  N.  R.  R.  is  assessed  at  $6,000  a  mile  for  main 
track  (including  land),  and  sidings  at  $2,000  a  mile  (including 

land). 

The  Baltimore,  Chesapeake  and  Atlantic  Railway  Company  is 
assessed  at  $4,000  a  mile  main  track  and  $2,000  a  mile  for 
sidings ;  both  include  land  and  right  of  way.  There  are  additional 
assessments  against  some  lands  of  the  railroad  in  dififerent  parts 
of  the  county. 

COUNTY  ASSESSMENT  BY  DISTRICTS. 

-  1.  Barren    Creek $590,715  50 

2.  Quantico     .654,339  00 

3.  Tyaskin    422,026  75 

4.  Pittsburg    420,236  50 

5.  Parsons   1,862.788  00 

6.  Dennis    196,316  25 

7.  Trappe    520,997  00 

8.  Nutters    337,559  00 

9.  Salisbury    2,179,790  00 

10.  Sharpstown    361,737  00 

11.  Delmar    705,608  00 

12.  Nanticoke   390,574  00 

13.  Camden    1,275,219  00 

14.  Willards    187,057  00 

Total $10,105,330  00 


County  Reports  165 

WORCESTER  COUNTY. 

Worcester  County  is  in  the  extreme  southeast  corner  of  the  State 
at  the  lower  end  of  the  Eastern  Shore,  and  is  the  only  county  of 
Maryland  that  borders  on  the  Atlantic  Ocean.  It  has  an  area  of 
491  square  miles.  Worcester  County  contains  the  largest  nursery 
business  in  the  State  which  covers  thousands  of  acres.  The  occu- 
pation of  its  residents  is  largely  agricultural. 

Sales  of  real  estate  under  decrees  of  the  Circuit  Court  are  not 
frequent,  and  in  most  cases  are  of  property  of  small  value. 

The  following  embraces  the  last  sales  of  property  where 
assessments  were  obtainable. 

Acres.  District.  Assessment.         Sale  Price. 

58 Newark    $400  00  $450  00 

House  and  Lot Snow   Hill 2,500  00  1,905  00 

20 Snow   Hill 650  00  390  00 

House  and  Lot Pocomoke   City 1,200  00  2,015  00 

2 East    Berlin 50  00  112  50 

150 Atkinson    900  00  1,000  00 

111 Snow   Hill 1,100  00  1,200  00 


6.800  00  7,072  50 

The  following  recent  sales,  selected  at  random,  will  illustrate 
assessment  and  sale  value — no  attempt  has  been  made  of  selec- 
tion, the  last  sales  being  considered  : 

Acres.                              District.               Assessment.  Sale  Price. 

100 Snow   Hill $1,500  00  $1,800  00 

House  and  Lot Stockton   500  00  500  00 

272 Atkinson    3,500  00  5,500  00 

13% West   Berlin 150  00  400  00 

115 St.   Martin's 725  00  1,200  00 

5  000                               ...  Snow  Hill  and  Stockton  40,000  00  *1 10,000  00 

317.  .■  ■■.■  ■.■.'.■.■ Snow   Hill 12,000  00  30.000  00 

100                 Snow   Hill 3.000  00  6,000  00 

50. ■.'.■. Snow   Hill 2.50000  4,000  00 

$63,875  00  $159,400  00 

DISTRICT  ASSESSMENT. 

In  all  but  the  Second  and  Eighth  districts  in  the  county  lands 
and  improvements  are  assessed  together  and  it  is  difficult  to  con- 


*Said  to  be  isolated  and  exceptional. 


166  Report  of  the  Commission 

sider  the  manner  of  assessment  without  examination  of  assessors' 
reports. 

In  the  chief  towns  of  the  county,  Snow  Hill,  Pocomoke  City, 
Berlin  and  Ocean  City,  property  is  not  assessed  on  a  front-foot 
basis,  and  it  is  impossible  to  compare  the  assessment  between 
them  or  to  compare  the  main  thoroughfares  with  those  of  towns 
of  like  size  and  industry  in  the  adjoining  counties  of  Wicomico 
and  Somerset. 

Newspapers  do  not  publish  lists  of  transfers  and  the  considera- 
tions are  seldom,  if  ever,  set  out  in  the  deeds,  and  information 
had  to  be  obtained  by  indirect  means. 

The  best  district  is  Snow  Hill  District  or  District  No.  2. 
There  is  no  system  of  taxing  the  woodland  of  the  county. 

The  county  was  assessed  in  1909,  prior  to  the  general  State 
reassessment  in  1910,  and  the  County  Commissioners  claim  to 
have  taken  the  return  of  the  local  assessors  in  very  few  cases. 
An  examination  of  the  prior  assessment  of  the  county,  made  in 
1896,  shows  that  little  attention  was  paid  to  prior  valuation  and 
would  indicate  that  the  County  Commissioners,  sitting  as  a  board 
of  review,  realized  the  enormity  of  their  task. 

It  is  claimed  by  the  board  that  there  was  an  attempt  to  equalize 
between  adjoining  parties. 

Woodlands  in  parts  are  assessed  $8.00  an  acre,  with  no  addition 
for  grade  and  growth  of  timber.  Some  instances  of  assessments 
will  suffice.  In  Costens  District  assessment  per  acre  varies  from 
$2.00  to  $35.00,  with  an  average  less  than  $10.00,  but  the  diffi- 
culty of  estimate  is  on  account  of  land  and  improvement  being 
listed  together. 

Stockton  District  varies  from  $3  to  $20  (probably  highest  in 
district). 

District  No.  6  varies  from  $3  to  $25. 

Ten  farms,  all  less  than  100  acres,  average  an  assessment  of 
$23.92  per  acre,  and  average  in  size  45  acres ;  and  fifteen  farms, 
varying  from  100  to  500  acres,  averaged  $9.05  per  acre;  average 
size,  295  acres.     These  aggregates  included  improvements. 

Some  of  the  hotels  at  Ocean  City  are  assessed  relatively  high, 
others  extremely  low,  as  compared  to  asking  price. 


County  Reports  167 

ADJOINING  COUNTIES. 

Districts  Nos.  6  and  7,  adjoining  Wicomico  County,  are  valued 
at  a  price  less  than  in  Wicomico,  but  regards  must  be  paid  to  the 
difficulty,  because  land  and  improvements  are  assessed  as  one  in 
Worcester.  There  is  a  marked  contrast  between  the  assessment 
of  Worcester  and  Somerset  Counties  in  favor  of  the  latter 
county. 

SECURITIES  AT  THE  THIRTY-CENT  RATE. 

There  are  no  securities  taxed  within  the  county  at  the  30-cent 
rate,  the  opportunity  for  securing  income  from  this  source  being 
wholly  disregarded. 

PERSONAL  PROPERTY. 

The  County  Commissioners,  sitting  as  a  board  of  review, 
claim  to  have  classified  personal  property  with  a  view  to  reaching 
an  assessment  indicative  of  value ;  there  were  three  classifica- 
tions of  horses— $200,  $100  and  $25. 

It  would  appear  that  automobiles  were  assessed  without  regard 
to  age  and  condition.  Securities,  as  listed  by  the  board,  mean 
notes  and  are  taxed  at  the  full  rate,  of  a  valuation  of  one-half. 

TOWN  ASSESSMENT. 

The  town  of  Snow  Hill  is  assessed  on  the  lot  plan,  and  has 
no  plat  showing  size  of  lots.  It  would  appear  that  lots  are  the 
usual  basis  of  sales.  The  town  lies  exclusively  in  one  district 
with  an  aggregate  assessment  of  $1,054,156.79  (of  which  $35,000 
has  an  outlying  rate  of  30  cents),  and  the  whole  district  is 
$2,076,573.66. 

East  Berlin  District  includes  part  of  the  town  of  Berlin  with  its 
local  assessment  of  $888,140,  and  the  Ocean  City  resort  with 
$550,000,  while  the  aggregate  county  and  State  assessment  of  the 
entire  district  is  $1,783,477.65.  These  aggregates  include  a  small 
fractional  part  of  the  district. 


168  Report  of  the  Commission 

The  local  assessment  of  Pocomoke  City  is  $1,455,775,  while 
the  entire  district  carries  a  county  and  State  assessment  of 
$2,164,860.22.     The  town  is  a  small  part  of  the  entire  district. 

IMPROVED  ROADS. 

In  the  opinion  of  county  officials  and  others  versed  in  values, 
the  improved  roads  built  by  the  State  entirely  have  increased  the 
value  of  adjoining  property  from  25  to  50  per  cent. 

RAILROAD  ASSESSMENT. 

The  railroads  are  assessed  to  each  district. 

The  N.  Y.,  P.  &  N.  R.  R.  traverses  one  district  only,  and  pays 
on  a  valuation  of  $6,000  a  mile  for  main  track  and  on  two  miles 
of  siding  at  $4,000  per  mile. 

The  B.,  C.  &  A.  Ry.  Co.  is  assessed  in  several  districts,  but 
uniformly  at  $4,000  a  mile  for  main  track  and  $2,000  a  mile 
for  sidings. 

The  Del.,  Md.  &  Va.  Ry.  is  assessed  at  $4,000  a  mile  for  main 
track  and  $2,000  a  mile  for  sidings. 

The  assessment  in  all  cases  includes  assessment  against  the 
land  or  right  of  way. 

Stations  are  separately  assessed. 

COUNTY  ASSESSMENT  BY  DISTRICTS. 

1 $2,164,860  22 

2 2,076,573  66 

3 1,783,477  65 

4 418,990  00 

5 529,475  00 

6 277,025  00 

7 430,075  00 

8 1,008,180  00 

9 1,159,813  80 

Total $9,848,410  33 


Reassessment  in  Maryland  169 


REASSESSMENT  IN  MARYLAND.* 

There  has  never  been  in  Maryland  a  period  when  reassess- 
ments were  made  at  regular  intervals,  or  when  assessments  for 
State  purposes  were  made  under  a  method  of  continuing  revalua- 
tion. The  first  State-wide  assessment  was  made  in  1777^  immedi- 
ately following  the  adoption  of  the  Constitution  of  the  preceding 
year,  and  the  only  purpose  of  making  it  and  levying  a  tax  upon 
the  basis  of  the  same  was  to  aid  America  in  its  war  with  Great 
Britain.     The  rate  was  two  shillings  on  the  pound. 

It  will  serve  no  practical  purpose  for  our  use  to  recite  all  the 
acts^  passed  about  this  period  and  prior  to  1812,  when  the  next 
act^  of  general  importance  was  passed.  This  Act  imposed  a  State 
tax  on  real  estate,  after  a  lapse  of  years  when  no  State  tax  was 
levied,  and  many  of  its  provisions  are  still  on  the  statute  books, 
having  been  re-enacted  from  time  to  time.  Then  came  irregular 
periods  when  no  general  property  tax  for  State  purposes  was 
levied,  and  when  the  expenses  of  the  government  were  small  and 
were  paid  from  receipts,  mostly  from  licenses  and  from  dividends 
on  investments'*.  Then  after  several  years,  during  the  close  of 
which  the  State  embarked  in  many  hazardous  enterprises,  a  State 
general  property  tax  became  a  lasting  necessity  and  at  an  extra 
session  of  the  General  Assembly  the  Act  of  1841'^  was  passed 
providing  for  a  reassessment  of  all  the  property  of  the  whole 
State.     This  was  after  a  lapse  of  twenty-nine  years.     Then  fol- 

*NoTE.— Throughout  this  article  attention  is  only  directed  to  property 
appraised  by  local  assessors,  and  upon  which  the  State  tax  is  paid  to  the 
local  authorities  and  accounted  for  by  them  to  the  State  Comptroller.  It 
does  not  include  assessment  against  shares  of  stocks  of  banks  and  Mary- 
land corporations,  savings  bank  deposits  nor  the  real  or  personal  property 
of  railroad  corporations.     Railroad  property  is  subject  only  to  local  taxation. 

^Chapter  21. 

-The  Acts  of  1785.  Chapter  41,  provided  for  the  reassessment  of  personal 
property  of  the  State,  and  the  Acts  of  1792,  Chapter  121,  and  Acts  of  1797, 
Chapter  89,  provided  for  a  reassessment  of  all  property,  but  it  is  doubtful  if 
the  assessments  were  actually  made.  There  were  numerous  other  acts 
about  this  period. 

^Chapter  191. 

•iHanna's  Financial  History  of  Maryland   (J.  H.  U.  Series). 

^Chapter  23.  (This  Act  established  the  Appeal  Tax  Court  of  Baltimore 
City,  Section  24). 


170  Report  of  the  Commission 

lowed  the  Acts  of  1852^  1866',  1876■^  1896«  and  1910'".  Conse- 
quently in  the  last  one  hundred  years  the  State  of  Maryland  has 
had  but  seven  acts  for  general  reassessment. 

There  have  been,  however,  acts  in  great  number,  supplemental 
to  these,  and  time  after  time  counties  have  seen  the  necessity  for 
a  new  assessment  of  their  territory  in  order  that  revenue  suffi- 
cient to  pay  local  expenditures  could  be  obtained  with  a  low  tax 
rate.  Baltimore  City  has  a  continuing  method  of  assessment 
with  provisions  for  total  revision  in  the  course  of  every  five 
years^%  and  many  of  the  cities  and  towns  have  powers  under  their 
charters  for  periodical  reassessing^-. 

The  State  Tax  Commission's  of  1888  has  incorporated  in  its 
report  an  exhaustive  study  of  taxation  in  Maryland  of  great  value 
from  a  historical  standpoint,  and  it  seems  hardly  necessary  to 
attempt  to  add  to  it. 

Few  States,  if  any,  have  had  appraisements  of  their  whole  ter- 
ritory at  such  irregular  and  rare  intervals,  and  the  trend  of  all 
State  governments  having  a  State  tax  levied  against  real  estate  is 
now  towards  equalization  boards  and  continuing  assessments. 

Prior  to  the  investigation  of  tax  conditions  in  Ohio  by  the 
Special  Tax  Commission  of  1908,  taxes  there  were  collected  on 
decennial  appraisements. 

Speaking  of  this  manner  of  delayed  assessments,  that  Commis- 
sion says : 

"The  least  tolerable  of  these  wrongs  results  from  the  decennial 
appraisement.  It  is  manifest  that  in  growing  communities  in 
this  State  the  whole  character,  and  necessarily  the  value,  of  any 
given  piece  of  real  estate  may  radically  change  within  a  period 

^Chapter  2>2>7. 
^Chapter  157. 
sChapter  178. 
oChapter  120. 
loChapter  300. 

i^City  Charter  of  Baltimore,  Section  164a. 

i^For  legislation  for  Baltimore  City,  see  report  of  the  Advisory  Com- 
mittee to  the  Mayor  of  Baltimore,  1907,  J.  H.  Hollander,  chairman. 

^•^This  Commission  was  appointed  under  the  provisions  of  the  Acts  of 
1886,  Chapter  488,  and  was  composed  of  John  P.  Poe,  president ;  Charles  M. 
Armstrong,  secretary;  Richard  T.  Ely,  Ph.  D.,  James  Alfred  Pearce  (after- 
wards an  associate  judge  of  the  Court  of  Appeals),  and  James  McSherry 
(afterwards  chief  judge  of  the  Court  of  Appeals).  Judge  McSherry  did 
not  sign  the  report  owing  to  his  election  to  the  bench  before  the  report  was 
formulated. 


Reassessment  in  Maryland  171 

much  shorter  than  ten  years.  Instances  have  been  brought  to  our 
attention  where,  within  a  few  years  after  the  last  decennial  ap- 
praisement, the  commercial  center  of  a  city  has  completely  shifted, 
so  that  millions  of  dollars  of  increased  value  have  escaped  taxa- 
tion, and  in  other  cases  the  values  as  determined  by  such  decen- 
nial appraisement  have  been  materially  reduced.  So  with  out- 
lying farm  property.  In  some  communities  instances  have  been 
shown  where  at  the  last  decennial  appraisement  property  put  on 
the  duplicate  at  acreage  prices  has  become  city  lots,  and  has 
increased  in  value  many  fold,  although  remaining  at  the  old 
assessment.  This  is  not  only  unfair  to  taxpayers  in  general,  be- 
cause of  the  escape  of  the  actual  value  of  property  from  taxation, 
but  it  works  a  hardship  to  individuals  whose  property  is  some- 
times continued  at  a  high  assessment  despite  a  change  in  circum- 
stances which  has  greatly  reduced  its  value.  The  sufferers  from 
such  injustice  are  without  a  remedy  until  the  next  decennial 
appraisement." 

Ohio  accepted  the  recommendation  founded  on  the  report  of 
its  Commission,  and  has  now  a  quadrennial  assessment. 

The  conditions  found  in  this  State  are  analogous,  and  the  same 
criticism  applies  to  all  cases  of  reassessment  after  long  intervals. 

It  must  not  be  assumed,  however,  that  the  aggregate  of  assess- 
ments of  the  political  units  have  remained  the  same  between  the 
periods  of  general  State  reassessment.  As  before  stated,  Balti- 
more City  reassesses  continuously  (Baltimore  City  has  the  status 
of  a  county),  and  the  counties  without  exception  provide  for  the 
assessment  of  new  buildings  and  omitted  personal  property. 

There  are  one  hundred  and  ten  cities,  towns  and  villages  in  the 
State  which  have  a  separate  local  assessment.  From  the  report 
made  by  these  to  this  Commission,  Oxford  in  Talbot  County, 
Kensington  in  J\Iontgomery  County,  Grantsville  in  Garrett  County 
and  Laurel  in  Prince  George's  County  have  a  reassessment 
every  three  years,  and  Church  Hill  in  Queen  Anne's  County  and 
Thurmont  in  Frederick  County,  every  five  years.  In  some  of  these, 
however,  the  new  basis  is  for  local  or  municipal  purposes  only 
and  the  State  basis  remains  the  same. 

Reassessment  in  Maryland  has  always  been  treated  as  a  legis- 
lative question,  but  all  students  of  taxation  admit  that  it  is  prop- 


172  Report  of  the  Commission 

erly  an  administrative  question.  Here  it  has  only  been  ordered 
after  a  great  public  clamor  and  when  the  demand  therefor  has 
been  incessant.  Such  neglect  is  analogous  to  building  an  im- 
proved street  or  highway  and  allowing  the  same  to  wear  until  it 
has  to  be  practically  rebuilt. 

When  reassessment  is  made  a  legislative  question,  it  inevitably 
becomes  a  political  party  question,  with  all  its  attendant  evils. 
For  instance,  when  the  demands  for  relief  and  better  readjust- 
ment became  incessant  about  1873,  the  Legislature  of  1874  met 
the  cry  and  passed  the  Act  of  1874,  ch.  514.  This  Act  is  sup- 
posed to  have  been  drawn  by  one  of  the  leading  lawyers^*  of  the 
State,  and  yet  when  the  bill  was  finally  engrossed  for  signature 
by  the  Governor  the  words  must  have  been  changed.  The 
language  of  the  Act  was  brought  to  particular  attention  in  the 
case  of  INIaxwell  vs.  State^^  It  appears  that  the  Legislature  had 
passed  an  act,  after  its  usual  course  through  committees  of  both 
houses  and  engrossing  committees,  which  provided  that  all  prop- 
erty in  the  State,  real,  personal  and  mixed,  should  be  exempt 
from  taxation  except  cemeteries,  charitable  institutions  and  other 
property  usually  within  the  category  of  exempt  property,  which 
was  the  direct  opposite  to  what  was  intended.  The  aid  of  the 
Court  of  Appeals  was  invoked  to  have  it  give  to  the  words  a 
meaning  which  was  supposed  to  have  been  intended.  The  Court 
very  properly  refused  and  declared  the  act  unconstitutional.  It 
is  generally  conceded  that  the  act  was  changed  maliciously  or 
otherwise  when  the  bill  was  engrossed  for  signature  by  the  Gov- 
ernor, although  it  is  possible  that  the  error  occurred  in  due  course. 
Reassessment  was  delayed  for  two  years,  until  the  next  session 
of  the  Legislature. 

The  circumstances  leading  to  the  passage  of  the  general  reas- 
sessment Act  of  1896  merit  recording  in  the  history  of  the  State 
more  fully  than  is  here  afforded,  and  it  is  generally  believed  that 
the  story  is  not  now  preserved.  The  agitation  began  about  1888 
or  1889,  and  became  most  pronounced  during  the  latter  year. 
Indeed,  throughout  the  whole  year  Baltimoreans  were  agitated 
b}    weekly  addresses  delivered  before  an  aggressive  taxpayers' 

i^Charles  J.  M.   Gwinii  is  generally  conceded  to  be  the  author  of  this 
Act,  also  those  of  1876  and  1890,  and  the  compromise  Act  of  1894. 
1540  Md.  273. 


Reassessment  in  Maryland  173 

association'*'.  Suffice  it  to  say  that  at  the  next  session  of  the 
Legislature  an  act  for  reassessment  was  passed  and  yet  vetoed 
by  the  Governor  to  satisfy  his  Eastern  Shore  constituency.  It 
may  properly  be  said  that  the  history  of  this  reassessment  should 
occupy  a  prominent  part  in  the  political  history  of  the  State'^ 

In  the  next  session  of  the  lawmakers  at  Annapolis  there  ap- 
peared another  bill,  the  provisions  of  which  were  very  inquisi- 
torial for  listing  of  personal  property  and  which  contemplated 
penalties  in  the  way  of  commitments  for  false  or  inadequate  re- 
turns instead  of  fines.  The  bill  had  provisions  for  what  were 
termed  sliding. scales,  but  which  properly  was  a  method  of  classi- 
fication of  property  at  different  rates  for  local  taxation.  During 
the  whole  session  the  bill  was  the  subject  of  contention,  and 
after  a  long  fight  and  failures  of  several  conference  committees 
of  both  houses  to  agree  it  was  passed  in  the  closing  hour  of  the 
last  session'^.  As  the  bill  was  not  signed  by  the  Governor  of  the 
State  within  the  time  fixed  by  the  Constitution,  it  was  a  nullity. 

The  Governor  during  the  following  winter  called  a  convention 
cf  persons  interested  in  taxation,  with  a  view  of  reaching  a  satis- 
factory agreement  on  a  new  bill  for  the  next  session,  and  the 
State  Tax  Commissioner  presided  over  the  deliberations  of 
this  convention.  Public-spirited  citizens  raised  a  fund  of  about 
$10,000  for  the  expenses  of  such  convention.  An  account  of  the 
proceedings  was  not  published  and  it  is  now  impossible  to  obtain 
a  report  of  their  findings,  if  any. 

In  the  succeeding  session''*  two  bills  were  introduced — one 
drawn  by  individuals  at  the  request  of  the  Governor,  and  the  bill 
of  the  previous  session.  It  looked  as  though  there  would  be  an 
agreement.  But  not  so.  The  question  of  listing  of  personal 
property  again  arose,  and  in  addition  a  mortgage  tax  was  pro- 
posed, and  a  bitter  fight  developed  on  the  attempt  to  have  the 

i^The  name  of  this  association  was  "The  Landlords'  Mutual  Protective 
Association  of  Baltimore  City."  Among  some  of  those  who  delivered 
addresses  were  Charles  J.  Bonaparte,  John  K.  Cowen,  Samuel  Snowden, 
Thomas  W.  Hall,  C.  M.  Armstrong,  F.  C.  Latrobe,  Thomas  Ireland  Elliott, 
William  L.  Marbury,  Joseph  Packard,  Jr.,  and  William  J.  Ogden.  The 
pamphlets  are  very  rare  and  valuable. 

I'Kent,  "Story  of  Maryland  Politics." 

i^Maryland  has  a  limited  session  of  ninety  days. 

isjournals  of  the  Senate  and  House,  1890,  1892  and  1894. 


174  Report  of  the  Commission 

State  pay  one-third  of  the  cost  of  the  assessment  in  each  county. 
One  bill,  however,  passed  the  Senate  and  was  promptly  killed  in 
the  House.  Relief  was  finally  granted  by  the  passage  of  the  act 
in  the  session  of  1896,  after  a  fight  of  eight  years. 

The  reassessment  of  1910  was  promptly  accomplished,  although 
there  was  an  attempt  by  several  counties  to  be  exempt  from  its 
provisions,  for  no  reason  other  than  the  cost^°  of  the  assessing. 

The  essential  features  of  the  Acts  of  1876,  1896  and  1910  are 
identical.  Each  county  was  divided  into  districts,  with  three 
assessors  to  the  district,  and  the  Act  of  1910  authorized  the  Gov- 
ernor to  appoint  two  assessors  in  each  district  and  the  county 
commissioners  one  assessor. 

There  are  sixty-eight  assessing  districts  in  the  counties  which 
were  included  in  the  general  reassessment  Act  of  1910,  and  the 
qualifications  for  appointment  as  appraisers  were  more  political 
than  otherwise.  Moreover,  it  is  extremely  doubtful  if  a  sufficient 
number  of  properly  equipped  men  could  be  obtained  and  trained 
in  such  a  short  time  to  assess  all  the  lands,  improvements  and 
personal  property  as  a  general  reassessment  contemplated.  The 
task  of  selection  imposed  on  the  Governor  was  impossible  of 
satisfactory  result;  the  task  imposed  on  the  local  appraiser  was 
equally  difficult,  however  conscientious  the  individual  might  be. 

There  were  no  attempts  nor  regulations  concerning  equal- 
ization. 

It  is  a  significant  fact  that  the  late  reassessments  have  failed 
to  provide  for  any  agency  for  equalization.  It  is  more  sur- 
prising, because  during  the  first  years  of  the  last  century,  when 
the  contributions  from  direct  taxation  were  small,  the  Legisla- 
ture was  anxious  that  persons  should  be  treated  equitably. 

The  Commission  of  1888  in  its  sketch  on  this  says : 

"One  of  the  most  marked  characteristics  of  the  legislation  of 
this  period  is  the  constant  effort  to  equalize  taxation.  These  pro- 
visions look  to  equalization  as  between  individuals  and  localities, 
and  extend  not  only  to  real  estate,  but  also  to  certain  kinds  of  per- 
sonal property,  the  value  of  which  would  not  vary  in  different 
parts  of  the  State,  and  which  would  be  correctly  valued  by  weight 
or  other  physical  standards,  according  to  fixed  schedules  em- 

20Sce  "Cost  of  Reassessment." 


Reassessment  in  Maryland  175 

bodied  in  the  law.  The  classes  of  personal  property  in  question 
were  silver  plate,  bar  and  pig  iron  and  slaves.  Instead  of  leaving 
silverware  to  be  valued  according  to  the  varying  and  perhaps 
defective  judgment  of  a  large  number  of  assessors  distributed 
through  the  different  sections  of  the  State,  the  assessment  laws 
required  the  assessors  to  value  it  by  weight  at  so  much  per  ounce, 
and  thus  secured  uniform  valuation  for  all  the  silverware  in  the 
State.  Some  of  the  acts  contained  a  similar  provision  for  crude 
iron.  Slaves  were  valued  according  to  age  and  sex,  at  the  rates 
set  in  the  statutory  schedules ;  but  the  assessors  were  to  allow  for 
infirmities  and  defects,  and  it  was  provided  'that  the  said  assess- 
ors shall  be  at  liberty  and  are  hereby  directed  to  estimate  male 
slaves  who  are  tradesmen  at  such  value  as  they  may  adjudge  them 
to  be  worth,  regarding  their  respective  trades  and  their  pro- 
ficiency therein.' 

"The  necessity  of  some  regulation  which  would  control  the 
assessors  in  the  different  counties  in  their  valuations  of  land,  so 
as  to  prevent  some  counties  from  escaping  their  due  share  of  the 
State  tax  by  means  of  valuing  their  land  at  inadequate  rates, 
was  felt  in  Maryland  then,  as  it  is  in  New  York,  Illinois  and 
elsewhere  now.  This  was  provided  for  in  1785  by  a  law  which 
fixed  the  average  value  per  acre  for  each  county,  and  required 
the  commissioners  of  the  tax  to  value  the  lands  in  their  respective 
counties  accordingly.  The  Act  particularly  specified  the  manner 
of  making  the  assessment.  The  commissioners  were  first  to 
ascertain  the  number  of  acres  of  taxable  land  in  their  county. 
This  was  to  be  multiplied  by  the  average  value  per  acre,  fixed  by 
th^  Act,  thus  fixing  the  'real  property  basis'  for  the  county.  All 
the  land  in  the  county  was  then  to  be  valued  at  its  real  worth, 
and  divided  into  classes  according  to  value,  and  it  was  then  to  be 
legally  appraised,  so  to  speak,  by  assigning  to  all  the  lands  in  the 
county  their  ratio  of  the  total  legal  basis  'in  just  proportion  ac- 
cording to  their  relative  value.'  If  there  were  any  towns  in  the 
county,  the  sum  of  the  actual  value  of  the  real  and  leasehold 
property  therein,  as  fixed  by  the  assessors,  was  to  be  deducted 
from  the  total  legal  basis  before  apportioning  it  to  the  land  in 
the  county,  except  Baltimore  town,  which  was  not  to  be  included 
in  Baltimore  County.  This  law  continued  in  operation  until  1841. 
After  its  passage  every  general  assessment  law  of  that  period 


176  Report  of  the  Commission 

(the  second)  expressly  adopted  it,  and  directed  its  provisions  for 
equalization  to  be  observed. 

"It  is  a  remarkable  fact  that  the  principle  of  equalization, 
which  was  recognized  and  enforced  by  law  for  more  than  half  a 
century,  was  laid  aside  when  the  general  assessment  law  of  1841 
went  into  operation,  since  which  time  there  has  been  no  attempt 
to  equalize  the  valuations  of  visible  personal  property  or  land. 
Of  late  other  States  have  adopted  systems  for  equalizing  the 
valuations  of  land,  but  we  abandoned  the  principle  forty-five 
years  ago."^^ 

A  COMPARISON  OF  THE  LAST  THREE  ASSESSMENTS. 

A  close  study  of  the  plats  set  out  on  the  following  pages  's 
interesting  from  several  viewpoints,  and  while  it  is  to  be  borne 
in  mind  that  these  aggregates  do  not  include  all  items  subject  to 
taxation,  but  only  those  accounts  upon  which  the  tax  is  paid 
directly  to  the  local  collectors,  yet  they  embrace  real  and  personal 
property,  including  securities,  which,  however,  were  listed  in 
the  personal  property  classification  until  1896.  The  lists  include 
the  same  items  at  each  reassessment. 

Real  estate  embraces  by  far  the  largest  portion  of  the  assess- 
iii^i..,  and  a  close  study  shows  that  assessments  in  some  counties 
have  at  times  been  less  than  that  of  the  preceding  year. 

2iWritten  twenty-five  3'ears  ago. 


Reassessment  in  Maryland  177 

The  following  table  will  illustrate  to  what  extent  the  losses 
have  occurred  in  the  period  cited : 

TABLE22  SHOWING  NUMBER  OF  TIMES  THE  STATE  ASSESS- 
MENT OF  EACH  COUNTY  AND  BALTIMORE  CITY  HAS 
INCREASED  OR  DECREASED  COMPARED  WITH  THE  PRE- 
CEDING YEAR  FROM  1877  TO  1912. 

No.  of  Times  No.  of  Times 

Decreased.  Increased. 

Allegany 12  21 

Anne  Arundel 13  22 

Baltimore    City 3  "hi 

Baltimore   County 1-^  28 

Calvert   16  19 

Caroline   7  28 

Carroll    16  19 

Cecil    14  21 

Charles  13  22 

Dorchester  10  25 

Frederick   16  19 

Garrett    11  24 

Harford   15  20 

Howard^i    16  18 

Kent 10  25 

Montgomery  4  31 

Prince    George's 8  27 

Queen  Anne's 10  2d 

St.    Mary's 18  17 

Somerset    14  21 

Talbot    13  22 

Washington  1 1  -4 

Wicomico 10  -^ 

Worcester 11  -4 

The  State 4  31 

22Compiled  from  reports  of  the  Comptroller  of  the  Treasury  of  the  State. 
23A  large  portion  of  the  territory  of  Baltimore  County  was  annexed  to 
Baltimore  City  in  1888. 
2^The  assessments  in  1901  and  1902  were  identical. 
(See  note  at  beginning  of  article). 


Reassessment  in  Maryland 


179 


ASSESSMENTS  FOR  STATE  PURPOSES 

DIAGRAMS  SHOWING  CHANGE  OF  ASSESSENT  FROM 
YEAR  TO  YEAR  OF  REAL  AND  PERSONAL  PROP- 
ERTY (INCLUDING  SECURITIES  OTHER  THAN 
STOCKS  OF  MARYLAND  CORPORATIONS)  FROM 
1877  TO  1912  INCLUSIVE. 

The  Diagrams: 


The  curved  or  broken  lines  on  the  plats  indicate  the  assessment 
for  the  years,  expressed  in  milHon  dollars.  The  exact  amounts 
of  assessments  are  shown  at  the  bottom  of  each  plat. 

The  general  contrast  between  the  varying  lines  is  impressive, 
and  besides  each  diagram  is  worth  close  consideration,  which  con- 
trast a  column  of  figures  setting  forth  assessments  might  not  so 
readily  disclose. 


180 


Report  of  the  Commission 


10,809,342 
10,644,042 
10,006,273 
16,269,506 
16,080,663 
16,087,197 
16,164,522 
16,141,506 
15,882,964 
15,813,862 
15,829,354 
15,735,459 

15,937,904 
15,986,804 

16,082,934 

16,151,558 

16,245,274 

16,490,596 

16,470,751 

16,478,481 

16,296,000 

16,236,750 

16,541,867 

16,577,298 

16,930,557 

17,260,488 

17,581,113 

18,018,661 

18,662,057 

18,928,409 

19,257,878 

19,638,532 

19,605,205 

19,905,000 

29,876,000 

29,738,200 


Reassessment  in  Maryland 


181 


O      ~      '"^J      (-"      -t^ 


en      o^      -J     Oo      -C     o        Millions 


.9,870,117 

10,037,008 
9,959,311 

9,740,978 

9,614,613 
9,697,963 
9,641,749 

9,510,556 
9,607,609 
9,538,476 
9,787,276 
9,988,600 
9,941,279 
10,134,804 
10,725,314 
10,874,049 
10,641,397 
10,625,243 
10,697,414 
10,824,481 
11,659,000 
11,969,427 
12,033,838 
11,903,042 
11,919,428 
11,802,166 
12,131,801 
12,255,991) 
12,345,370 
12,208,880 
12,476,303 
12,778,910 
13,120,673 
13,086,000 
19,211,478 
19,680,117 


1877 

1878 

1879 

1880 

1881 

1882 

1883 

1884 

1885 

1880 

1887 

1888 

1889 

1890 

1891 

1892 

1893 

1894 

1895 

1896 

1897 

1898 

1899 

1900 

1901 

1902 

1903 

1904 

1905 

1906 

1907 

1908 

1909 

1910 

1911 

1912 

\ 

i 

/ 

[ 

\ 

1 

\ 

> 
2 

1 

j 

o 

\ 

o 

\ 

o 

\ 

'A 

\ 

i 

\ 

\ 

\ 

-- 

— 



A 

Reasskssmf.nt  is  Maryland 


BALTJMORK  CITY 


Scale  :    One-fifth  aHe  ot  other  Counties  (except  Baltimore  C«untyl 


:'26,lWS,776 

:',S7.l)0,S.084 
:';i4,'l-t7,.i61 
i;40.772,i>H2 
L'4  4, 240,04: 
:M7,4l.'.i,l'70 
L'on,Wll,4S6 
:;7(i,4MS,n,52 
277,171,(112 

2S(i,4ll!l,;>.i2 

1110.15:1.115 
L'ii;:,;^ii,s,:;75 
r)ti,2i;i,]tis 
:«l,.M4.n;i2 
:!;!!i.;n.i7, 0.^.5 
;:4::.n'^7,l;;o 
:iu\,sHO,(i04 
:is;i.4io,S23 
;is.i.:-:4s..52S 

;(Hi  1,362.772 
40li.',iOJ,7ii3 

4:;2.2n7,iii;4 
4.5o,42H,;;;t!) 
47J.07!l,-.23 

4«0,27K,:i,'>6 
4K.i,",l54,!l20 
nO,i,7S4,170 
.il('.:iS],SK2 


ls7,S 

1S71I 
issii 

I  SHI 

ls,s-_' 

18K:! 
tSS4 
1SS.S 

ISMIi 


IS'.l 
ISitL' 

IHitH 
IS!  14 
IS'L-i 


1S',)S 
IS!  II I 
i^lOll 


1!I04 

I1IIJ.T 


C) 


184 


Report  of  the  Commission 


HAl.TlMdKI':  CdrxTY 


Scale  :    Two-fiflhs  of  other  Coiintii 


o 

-li 

o 

Ui 

o 

s 

^ 

U- 

o 

j\ 

-o 

Ln 

§ 

o 

o 

ji 

o 

^ 

■4^ 

4: 

o 

J-1 

:7^ 

> 

•50,501, lliO 

1 

" 

^" 

■19,121,170 

1 

4S,.'i5B,857 

1 

51,121,41(1 

- 

50,3411,222 

— 

52,626,  S1I3 

t 

50,939,:iie 

/ 

52,3.S4,0S4 

s 

53,160,0!  15 

53,807,-«2 

65,330,1!J0 

\ 

■•54,741,67s 

1 

38,670,472 

— 

39.4S4,174 

\ 

30,650,044 

] 

41,360,723 

V 

43,820,149 

N 

V 

44,284,405 

\ 

46,386,204 

\, 

47,713,874 

^ 

\, 

00,966,863 

r~ 

67,541,824 

\ 

07,526,140 

08,700,072 

k, 

72,871,863 

\ 

75,523,886 

\ 

78,125,678 

S 

82,239,853 

N. 

s 

84,181,948 

S. 

87,070,777 

N 

92,604,.S41 

■"v 

s 

90,908,580 

s 

s 

I(J4,052,225 

*^ 

110,01.">,.5B7 

' 

"^ 

^ 

133,005,074 

"^ 

— " 

-— 

142,7.37,913 

"* 

■^ 

"^ 

^ 

_^ 

_ 

_ 

.^ 

1S7S 
1.S79 
18S0 
1881 
18S2 
18K1 
1SS4 
is.s5 
I.SSO 
1887 
188,8 
1889 
1800 
1.S9I 
1S92 
1S93 
1894 
LS95 
1.890 
1.807 
iS98 
IS'.flJ 
101  111 
19111 
1902 
1003 
1904 
190.-. 
1900 
1907 
190S 
1909 


r 


Reassessment  in  Maryland 


185 


Co  U) 


2,413,55i» 

2,070,4('t) 

2,064,68:5 

2,059,122 

2,114,563 

2,053,787 

2,087,411 

2,146,158 

2,100,771 

2,077,551 

2,068,895 

2,089,736 

2,065,620 

2,049,849 

2,037,800 

2,033,209 

2,032,746 

2,025,655 

2,036,969 

2,041,520 

2,159,085 

2,187,206 

2,163,183 

2,213,842 

2,287,295 

2,287,626 

2,280,094 

2,257,261 

2,263,212 

2,329,177 

2,366,953 

2,384,220 

2,405,168 

2,449,222 

3,030,031 

3,037,614 


\ 


Millions 

1877 

1878 

1879 

1880 

1881 

1882 

1883 

1884 

1885 

1886 

1887 

1888 

1889 

1890 

1891 

1892 

1893 

1894 

1895 

1896 

1897 

189S 

1899 

1900 

1901 

1902 

190:'. 

1904 

1905 

1906 

1907 

1908 

1909 

1910 

1911 

1912 


w 

Q 


186 


Report  of  the  Commission 


^ 

e?; 

o^ 

N 

J6 

•^ 

•^ 

^3 

Ul 

16,167,511 

15,670,144 
15,515,14'.* 

/ 

f 

/ 

15,435,432 
15,269,086 
15,308,087 

/ 

/ 

1 

15,898,600 
15,415,994 

\ 

/ 

15,7]  7,1)27 

\ 

15,710,461; 
15,987,384 
16,008,671 

1 

\ 

15,981,002 

, 

15,925,445 

15,885,655 

15,877,537 

15,767,780 

15,873,720 

15,823,57(; 

15,624,677 

1 

16,110,873 

\ 

16,128,876 

16,303,785 

10,142,132 

16,194,617 

16,357,572 

16,485,538 

16,518,672 

16,363,lisi 

16,506,716 

17,021,949 

\ 

\ 

17,311,797 

\ 

17,510,810 

\ 

17,750,62:; 

\ 

24,886,601 

' 

1 . 

— 

. 

22,787,036 

-^ 

Millions 
1877 

1878 
1879 
1880 
1881 
1882 
1883 
18,S4 
1885 
1886 
1887 
1888 
1889 
1890 
1891 
1892 
]  ,S!)3 
1894 
1895 
1896 
1897 
1898 
1899 
1900 
1901 
1902 
1903 
1904 
1905 
1906 
1907 
1908 
1909 
1910 
1911 
1912 


O 


o 

o 


Reassessment  in  M akvi-wd 


187 


ro^    ->JieK,0\~NjOo^ 


3,7.57,157 
3,795,639 
3,765,517 
3,942,308 
3,898,522 
3,937,525 
3,987,037 
4,051,281 
4,089,772 
4,108,667 
4,1S1,417 
4,178,804 
4,307,925 
4,357,926 
4,381,469 
4,351,415 
4,347,318 
4,423,643 
4,430,862 
4,426,389 
4,627,000 
4,668,185 
4,676,104 
4,721,552 
4,700,  l'i6 
4,778,054 
4,894,306 
5,018,458 
5,084,688 
5,254,170 
5,393,571 
5,500,850 
5,617,542 
5,747,000 
9,883,000 
10,069,636 


O 

o 

Q 
O 

a 


188 


Report  of  the  Commission 


^Sfc  "*«.  ^^  ■"s,^ 

Nj      <Ju      -^      Oi 


13,198,535 

12,882,258 

12,837,736 

12,700,694 

13,466,499, 

12,875,498 

12,898,600 

12,958,595 

12,976,250 

13,012,712 

13,048,033 

12,983,837 

13,108,605 
13,141,457 
13,389,101 
13,271,949 
13.353,880 
13,330,625 
13,301,341 
12,995,804 
12,061,251 
11,446,771 
11,624,849 
11,656,238 
11,574,015 
11,629,506 
11,585,260 
11,852,649 
11,921,457 
11,951,176 
11,487,499 
11,846,632 
13,688,817 
14,247,321 
14,413,821 
15,556,053 


O 

w 
o 


o 
o 
a 
"-A 


Reassessment  ix  Marvlanu 


189 


tu  uj  S::  Oi  o, 


3,452,501 
3,301,935 
3,400,601 
3,387,830 
3,387,97S 
3,432,701' 
3,441,914 
3,473,1 71 ; 
3,473,249 
3,340,663 
3,308,863 
3,466,557 
3,373,135 
3,328,74:; 
3,322,016 
3,410,140 
3,173,149 
3,451,109 
3,449,089 
3,361,148 
3,507,315 
3,516,.354 
3,527,169 
3,527,777 
3,476,269 
3,484,239 
'3,473,100 
3,418,138 
3,421,990 
3,480,981 
3,677,424 
3,767,875 
3J75,698 
3,929,003 
5,386,316 
5,470,301 


Millions 

1877 

1878 

1879 

1880 

1881 

1882 

1883 

1884 

1885 

1886 

1887 

1888 

1889 

1890 

1891 

1892 

1893 

1894 

1895 

1896 

1897 

1898 

1899 

1900 

liiOl 

1902 

1903 

1904 

1905 

1906 

1907 

1908 

1909 

1910 

1911 

1912 


O 


GO 
O 

o 
d 

H 


190 


Report  of  the  Commission 


S^oicK    ^oovci,^    ^i^^Oi-^ 


6,02i>,790 
6,042,593 
6,001,429 
5,8B6,95S 
5,766,136 
5,799,077 
5,877,685 
5,952,325 
6,230,385 
6,263,191 
6,239,824 
6,209,166 
6,202,704 
6,191,835 
6,183,618 
6,193,888 
6,170,773 
6,215,276 
6,249,199 
6,218,644 
6,510,384 
6,516,051 
6,516,125 
6,629,830 
6,668,559 
6,792,088 
6,839,534 
6,882,742 
6,959,318 
7,017,255 
7,093,800 
7,105,777 
7,321,275 
7,547,951 
13,014,716 
13,100,065 


1 

/ 

V 

\ 

' 

1 

\ 

— 

L 

\ 

Millions 

1877 

1878 

1879 

1880 

issi 

1882 

1883 

1884 

1885 

1886 

1887 

188S 

1SS9 

]S9() 

1891 

1 892 

1893 

1S94 

1895 

1896 

1897 

189S 

1899 

190O 

1901 

1902 

1903 

1904 

1905 

190(i 

1907 

1908 

1909 

1910 

1911 

1912 


O 


c 
o 
d 


Reassessment  in  ^Iaryland 


191 


C>      ^ruU><OiQs^>3    Oa     -<i     c:>       Millions 


2.5,4S2,71() 

2-l,oli',^:51 

24,ni,4()9 

23,U0o.l26 

2:^,60:5,626 

23,557,641 

2:^,440,219 

2:^,503,857 

23,373,506 

23,313,265 

23,522,448 

23,485,083 

22,769,810 

22,060,656 

23,1:59,041 

23,613,0::50 

23,649,024 

23,464,265 

23,492,501 

23,453,842 

20,297,000 

20,292,220 

19,946,984 

20,026,440 
19,866,7:58 
19,900,554 
20,004,8:34 
20,305,785 
20,459,968 
20,761,114 
21,063,766 
21,647,949 
21,997,929 
22,263,401 
28,960,000 
29,205,674 


u 
o 

Q 


2! 


192 


Report  of  the  Commission 


ru    (x>    >fc 

^ 

CN    vj    Oa 

•<i 

^ 

::::; 

3,330,359 

3,599,108 

3,322,030 

3,315,508 

3,427,170 

3,184,643 

3,640,491 

3,608,309 

3,754,991 

3,707,055 

3,788,893 

3,780,904 

4,081,385 

4,058,083 

4,124,187 

4,201,010 

4,155,418 

3,992,440 

4,320,033 

4,344,880 

6,565,73ti 

\ 

/ 

i 

) 

y 

> 

\ 

L 

v 

■^ 

»^. 

\ 

0,754,09] 
6,908,191 
0,850,240 
0,947, 20(i 
0,995,043 
7,220,205 
7,410,143 
7  9^^  fi.1% 

' 

\ 

\ 

7  OQ7  QQli 

1 ,^yi ,yoo 
7  MCi  nw 

\ 

7  ft7^  ^J.Q 

7  769  fios 

7.840,857 

7,799,133 

10,835,753 

^\. 

^ 

Millions 

1877 

1878 

1879 

1880 

1881 

1882 

1883 

1884 

1885 

1886 

1887 

1888 

1889 

1890 

1891 

1892 

1893 

1894 

1895 

1890 

1897 

1898 

1899 

1900 

1901 

1902 

1903 

1904 

1905 

1900 

1907 

1908 

1909 

1910 

1911 

1912 


S3 
W 
H 

Q 
O 


Reassessment  in  Maryland 


193 


11,506,902 
11,488,421 
11,590,410 
11,508,588 
11,579,349 
11,554,870 
11,623,147 
12,024,855 

11,958,306 

12,112,730 

12,016,380 

12,146,159 

12,177,305 

12,168,815 

12,137,015 

12,444,104 

12,476,493 

12,548,934 

12,584,156 

12,581,788 

12,337,256 

12,295,276 

12,139,488 

12,209,474 

12,280,093 

13,121,085 

12,973,152 

12,961,588 

13,067,956 

13,119,837 

13,037,598 

13,304,745 

13,333,967 

13,403,304 

17,468,688 

17,562,392 


o 
w 

O 

d 


194 


Report  of  ihe  Commission 


'^  ^  oo  -<i  ^ 


7,526,408 

7,485,225 

7,283,386 

7,286,078 

7,254,355 

7,440,497 

7,505,097 

7,394,075 

7,134,406 

7,301,775 

7,220,394 

7,118,599 

7,393,822 

7,387,633 

7,436,312 

7,515,094 

7,718,383 

7,774,969 

7,769,741 

7,789,975 

9,035,219 

8,956,367 

8,936,509 

8,641,156 

8,681,608 

8,681,608 

9,032,396 

8,906,387 

9,207,432 

9,394,320 

9,594,235 

8,921,692 

9,211,895 

8,856,591 

11,221,665 

11,212,215 


C 

a 


Reassessment  in  Maryland 


195 


CK    -sf     Oo    -^     ^ 


7,448,30] 
7,391,910 
7,280,815 
7,275,783 
7,281,758 
7,365,341 
7,366,776 

7,445,110 
7,502,484 
7,575,272 
7,635,358 
7,665,905 
7,698,225 
7,817,118 
7,759,640 
7,783,728 
7,786,756 
7,787,379 
7,776,221 
7,808,823 
7,513,413 
7,514,200 
7,414,762 
7,409,972 
7,444,878 
7,486,877 
7,611,366 
7,703,449 
7,618,879 
7,751,494 
8,372,949 
8,366,801 
8,369,918 
8,538,703 
8,540,729 
10,202,615 


J 


] 


X 


B 


Millions 
1877 
I87S 
1879 

1,S80  ■ 
18S1 

1SS2 

1883 

1884 

1885 

1886 

1887 

1888 

1889 

1890 

1891 

1892 

1893 

1894 

1895 

1896 

1897 

1898 

1899 

1900 

1901 

1902 

1903 

1904 

1905 

1906 

1907 

1908 

1909 

1910 

1911 

1912 


H 

o 

H 


196 


Report  of  the  Commission 


Vo 


O^-JCD-Qq    —    rooj-t:(-^o~~-'co-oo 


Millions 


8,272,571 
7,954,743 
7,895,938 
7,867,651 
7,922,666 
7,985,248 
8,065,218 
8,233,700 
8,365,885 
8,399,698 
8,610,481 
8,652,162 
8,9J2,545 
9,284,145 
9,951,605 
10,425,220 
10,948,315 
11,113,115 
11,362,975 
11,510,125 
11,945,080 
11,763,420 
11,878,800 
12,067,945 
12,167,550 
12,315,495 
12,475,040 
12,522,670 
12,994,690 
13,433,015 
13,869,690 
14,126,890 
14,537,570 
15,089,930 
19,695,735 
19,889,225 


C 

H 

Q 
O 

W 

o 


Reassessment  in  Maryland 


197 


Millions 


9,073,303 

9,090,574 

8,982,347 

8,993,5'72 

8,887,696 

8,893,219 

8,743,183 

8,822,183 

8,837,482 

8,880,100 

8,852,948 

8,787,916 

8,780,315 

8,840,466 

9,005,217 

9,138,883 

9,312,695 

9,404,263 

9,470,651 

9,539,012 

10,886,463 

10,983,704 

10,524,735 

11,193,453 

11,404,772 

11,498,131 

11,551,866 

11,709,753 

11,797,340 

12,104,537 

11,698,984 

12,031,952 

12,290,577 

12,893,478 

16,099,390 

16,323,495 


h-l 

O 
W 


198 


Report  of  the  Commission 


(1,585,383 

6,587,119 

(),624,766 

6,721,127 

6,796,882 

6,864,147 

0,896,583 

7,035,605 

7,132,056 

7,188,854 

7,208,549 

7,166,684 


O,     (Jn      ^vJ    Od    •'Q    c::^       Millions 

1877 


7,253,125 
7,238,875 
7,230,844 
7,544,416 
7,430,105 
7,224,638 
7,350,708 
7,308,051 
8,409,452 
8,484,945 
8,353,466 
8,359,955 
8,328,605 
8,405,041 
8,388,517 
8,428,970 
8,536,561 
8,616,395 
8,652,907 
8,897,643 
9,369,575 
9,362,57^ 
9,879,912 
10,064,234 


d 
> 

Q 

O 
G 

H 


Reassessment  in  Maryland 


199 


ru  cju  ^:^  Lh 


2,918,698 
2,871,602 
2,840,450 
2,820,066 
2,782,189 
2,844,116 
2,749,196 
2,802,636 
2,784,883 
2,780,542 
2,773,800 
2,828,374 
2,846,035 
2,831,943 
2,831,924 
2,718,126 
2,753,441 
2,701,774 
2,695,668 
2,725,734 
3,068,723 
3,094,708 
3,194,207 
3,158,377 
3,114,018 
3,172,224 
3,169,000 
3,237,329 
3,251,914 
3,297,369 
3,338,883 
3.382,691 
3,370,807 
3,416,922 
5,091,187 
5,058,071 


II 

^ 

1 

^ 

\ 

' 

^^ 

Millions 

1877 
1878 
187!) 
1880 
1881 
1882 
1883 
1884 
1885 
1886 
1887 
1888 
1889 
1890 
1891 
1892 
1893 
1894 
1895 
1896 
1897 
1898 
1899 
1900 
1901 
1902 
1903 
h)04 
1905 
1906 
1907 
1908 
1909 
1910 
1911 
1912 


zn 

H 


> 

Q 

O 
cj 

H 

k1 


200 


Report  of  the  Commission 


tV>  Oj  -^  Oi  Ov  vj  oo 


3,939,349 
3,892,427 

3,888,755 
3,828,853 
3,782,982 
3,807,308 
3,953,305 
4,071,261 
4,107,729 
4,138,836 
4,151,567 
4,168,316 
4,149,015 
4,171,481 
4,088,342 
4,193,568 
4,098,858 
4,140,262 
4,074,600 
4,179, 18^J 
4,328,676 
4,305,654 
4,293,856 
4,321,418 
4,316,018 
4,403,942 
4,441,696 
4,537,035 
4,491,118 
5,101,051 
5,155,551 
5,217,208 
7,244,422 
7,236,936 
7,210,980 
7,339,054 


j 

L_ 

. 

^ 

- 

"X 

^ 

X 

Millions 

1877 
1878 
1879 
1880 
1881 
1882 
1883 
1884 
1885 
1886 
1887 
1888 
1889 
1890 
1891 
1892 
1893 
1894 
1895 
1896 
1897 
1898 
1899 
1900 
1901 
1902 
1903 
1904 
1905 
1906 
1907 
1908 
1909 
1910 
1911 
1912 


O 

cc 

H 

a 
o 
d 

H 


Reassessment  in  Maryland 


201 


-vj  oo  -^  ^ 


^o 


8,107,14! 
8,090,189 
8,282,716 
8,359,208 
8,321,037 
8,321,792 
8,313,249 
8,454,763 
8,636,216 
8,583,112 
8,544,765 
9,059,965 
8,786,320 
8,734,617 
8,634,056 
8,698,294 
8,752,668 
8,686,340 
8,598,134 
8,507,574 
8,028,980 
8,103,532 
8,093,409 
8,119,831 
8,271,509 
8,358,676 
8,296,847 
8,391,564 
8,460,410 
8,575,725 
8,747,475 
8,840,050 
9,022,505 
9,040,344 
9,048,915 
12,200,000 


( 

r 

\ 

1 

\ 

\ 

T    _ 

/ 

_ 

' 

\ 

\ 

^ 

~- 

^^^ 

Millions 

1.S77 

1878 

1879 

1880 

1881 

1882 

1883 

1884 

1885 

1886 

1887 

1888 

1889 

1890 

1891 

1892 

1893 

1894 

1895 

1896 

1897 

1898 

1899 

1900 

1901 

1902 

1903 

1904 

1905 

1906 

1907 

1908 

1909  • 

1910 

1911 

1912 


td 
O 

o 
d 


202 


Report  of  the  Commission 


16,599,731 

16,596,878 

16,257,939 

16,387,888 

16,362,119 

16,447,907 

16,478,505 

16,445,169 

16,695,783 

16,935,110 

16,922,860 

17,096,410 

17,162,101 

17,102,016 

17,055,413 

17,351,775 

17,624,007 

17,89(5,908 

18,155,542 

18,181,342 

19,016,000 

18,880,030 

19,010,744 

18,801,731 

18,839,015 

19,252,335 

19,181,679 

19,505,288 

19,913,389 

20,127,031 

20,774,420 

21,159,555 

21,865,14.", 

22,714,000 

33,343,000 

32,689,096 


Reassessment  in  Maryland 


203 


C\*CoSiO«,0N     \|C0^  Millions 

4,479,301 1877 

4,437,978 T i878 

4,589,032 X 1979 

3,587,688 / 1880 

3,553,660  T 1881 

3,628,138  _r 1882 

3,636,710 \ 1883 

3,720,429 1884 

3,764,730 1885 

3,778,086 1886 

3,748,288 1887 

4,020,797 ^^ 1888 

4,085,008 I 1889 

4,059,209    r^ ],S90 

4,065,605 1891 

4,149,119 1892 

4,130,495 1893 

4,344,912 T_ 1894 

4,398,876 1895 

4,454,892 1896 

5,223,303  N 1897 

4,855,307         J 1898 

4,679,024      jl  1899 

4,648,366 T 1900 

4,790,296 _r lltOl 

4,923,602 ^ 1902 

5,051,298 1903 

5,071,776 1904 

5,204,541 L 1905 

6,246,867 ^^^ 1906 

6,258,159 1907 

6,310,352 Y_ 1908 

6,525,506  3|       I       I       lYl       I      LJ  1909 

6,810,364         I       I       I      I    \l       I      I       I  1910 

9,836,818 —  ^ ^"^^^ 

9,409,400         I       I       I      I       I       1/1       I  1912 


b 


o 
o 
d 

H 


204 


Report  of  the  Commission 


a.  S^  ^   (tn  -^  oo  -^ 


Millions 


4,180,188 

4,142,368 

4,069,491 

4,052,108 

4,082,254 

4,222,427 

4,142,921 

4,311,018 

4,257,484 

4,339,645 

4,288,843 

4,396,292 

4,419,453 

4,458,468 

4,477,273 

4,605,481 

4,638,589 

4,928,274 

4,881,490 

4,992,885 

5,169,919 

5,327,366 

5,346,350 

5,091,900 

5,070,725 

5,017,042 

5,194,584 

5,231,855 

5,317,700 

5,331,275 

5,305,051 

5,671,375 

8,543,060 

8,563,450 

8,637,055 

8,759,936 


CO 


o 

o 


Rkassf^sment  in  Marylanij 


205 


TH1-:  STAT1-: 


u- 

^ 

O 

o 

o 

o 

O 

-t 

Ui 

o 

o 

CD 

o 

O 

8 

o 

O 

■o 

o 

o 

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s 

o 

o 

o 

g 

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c:> 

O 

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o 

o 

o 

Q 

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s 

o 

o 

CO 

o 

— 

o 

(-1 

-1 

ggg« 

<7S,468,028 

- 

__ 

_ 

_ 

_ 

■■■ 

4(14,42.'),7!ll) 

Y 

^ 

' 

l(l(i,-l"ll,"!IJ 

~ 

? 

— 

„ 

~ 

r~ 

4o».187,408 

~ 

_ 

Ji;l,4.5!l,9:ii) 

__ 

~ 

— 

"^ 

4li4,»24,871J 

V 

'    ' 

~ 

~ 

~~ 

4GI),085l,:!SO 

Jy 

~ 

: 

4011,5113,220 

, 

' 

~~ 

47:i,4o2,144 

V 

L 

~^ 

' 



47li,S2!l,CU 

5 

H 

^ 

485,839,772 

V 

~ 

" 

4110,016,183 

— 

_\ 

, 

"" 

~ 

~ 

477,3118,380 

y 

482,184,824 

^ 

-1 

-1 

~* 

~ 

.•.1(1,003,077 

■^ 

^.. 

.'il.'b,  137,578 

\ 

'  ' 

524,050,241 

\ 

5211,138,103 

^ 

.534,(130,476 

^ 

540,401 ,747 

\ 

007,1105,272 

' — 

(;03,320,090 
(ill  63!),040 

— 

7 

•*s 

■*-*. 

\ 

^. 

s 

010,7111,782 

\ 

"•* 

^ 

043,812,408 
000  857  803 

<. 

"~ 

"»«. 

^ 

^. 

^ 

073,337,21111 

> 

i 

•^ 

■^ 

"** 

1 

■^ 

^ 

"^ 

*^ 

^ 

^ 

"^ 

^^ 

7W,  1011,228 

^ 

"■ 

^ 

vl 

— 

, 

^ 

•^ 

s00.83i,:;:i^' 

\ 

*" 

^ 

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■^ 

^ 

•*. 

■^ 

"~~ 

— ■ 

— 

— 

lu^ 

!i7!i,:;ii!i,!P7(i 

•^ 

v. 

^ 

1880 
1881 
1882 
188.3 
18.84 
188.', 
1880 
1887 
1.888 
1.880 
18110 
IMIl 
18112 
18113 
18114 

181I.T 

18118 
18117 
18118 
181111 
11100 
ISIOI 
11102 
11KI3 
11104 
11105 
11100 
11107 
11108 
11)011 
11110 

mil 


eCity  and  One-iUi 


'Shc.witiK  projertwi  lini'  of  uniform  Int. 


( 


Reassessment  in  Maryland  207 

Allegany  County  reached  a  high  point  of  assessment  in  1880, 
and  receded  therefrom  until  1894,  when  it  surpassed  this  former 
high  mark,  but  again  began  to  recede  until  1898,  since  which  time 
its  new  assessments  have  been  generally  increasing. 

Eliminating  from  consideration  the  changes  brought  about  by 
the  reassessment  of  1910,  Anne  Arundel,  Calvert,  Caroline, 
Carroll,  Charles,  Dorchester,  Harford,  Howard,  Kent,  Prince 
George's,  Queen  Anne's,  St.  Mary's  and  Wicomico  Counties  have 
been  almost  constant  with  variations  increasing  or  decreasing; 
while  Talbot  County,  until  1912,  showed  a  net  change  in  the  years 
between  1877  and  1911  only  of  $900,000;  it  may  be  stated  that  it 
was  less  in  1911,  compared  with  the  assessment  for  1888.  This 
condition  is  inconceivable  to  one  familiar  with  that  county. 

Baltimore  City  showed  a  marked  depression  from  1877  to  1888, 
since  which  time  it  has  with  one  exception  increased  on  a  large 
original  basis  of  valuation;  Baltimore  County's  loss  of  asses.s- 
ment  of  1888  was  occasioned  by  annexation  of  part  of  its  terri- 
tory to  Baltimore  City,  since  which  time  its  change  of  basis  has 
been  most  marked. 

Cecil  County  showed  and  has  maintained  a  loss  beginning  with 
■'.895  until  1909,  while  the  depreciation  in  Frederick  County 
began  in  1877  and  continued  until  the  reassessment  of  1910. 
Garrett  County's^^  aggregate  of  increase  is  224  per  cent.,  the 
highest  in  the  State,  caused  no  doubt  by  maintaining  the  increase 
of  basis  as  established  in  1896.  Montgomery  County  has  been 
consistent  in  increase,  and  so  has  Washington  County  until  after 
reassessment  of  1910,  since  which  time  it  has  receded  about 
$650,000.  Carroll  County,  too,  has  lost  since  reassessment, 
$2,100,000.  There  were  reassessments  in  Somerset  and 
Worcester  Counties  in  1908  under  provisions  of  local  laws.  The 
State's  change  is  about  constant. 

Unless  there  is  some  fundamental  reason  for  the  losses  of 
assessment,  such  as  panics  or  financial  depression,  the  conclusion 
must  be  that  the  lack  of  proper  administration  is  the  cause.  The 
panics  of  the  United  States  may  be  disposed  of  when  it  is  stated 
that  in  the  years  under  consideration  there  was  a  depression"^  in 
1884,  in  the  years  immediately  preceding  and  following  1893,  and 

25Garrett  County  was  formed  in  1872  under  provision  of  Chapter  212  of 
that  year. 
2'JJuglar :     "Brief  History  of  Panics  in  the  United  States." 


208  Report  of  the  Commission 

that  of  1907.  Only  the  panic  of  1893  was  general  in  the  sense 
tliat  reflection  should  be  shown  in  real  estate  values,  especially 
farms,  and  was  of  long  duration,  and  it  was  not  until  years  later 
that  there  was  complete  recovery.  Those  of  1884  and  1907  were 
short-lived,  with  little  reflection  in  real  estate  values.  It  seems 
nnpossible  to  find  any  sufficient  cause  to  account  for  the  fre- 
(juency  and  amount  of  the  decreases  in  assessment. 

The  Baltimore  fire  of  1904  destroyed  over  $25,000,000  in 
tangible  property  included  in  the  taxable  basis,^^  but  the  re- 
covery was  quick  and  no  lasting  efifect  is  noticed  in  the  assess- 
ment. Improved  assessment  methods  in  the  city  contribute 
largely  to  this  result. 

The  assessments  between  the  periods  may  be  contrasted  by  a 
summary  as  expressed  in  the  two  tables  immediately  following 
and  sufficiently  explained  in  the  caption: 

TABLE28  SHOWING  INCREASE  OF  ASSESSMENTS  OF  REAL 
AND  PERSONAL  PROPERTY  AND  SECURITIES  FROM  1877 
TO  1912.  INCLUSIVE. 

1.  Baltimore   City $273,249  875 

2.  Baltimore   County 92,236,753 

3.  Allegany  County 18,928.858 

4.  Washington   County 16,089,365 

5.  Montgomery  County 1 1,616,654 

6.  Anne  Arundel  County 9,810,000 

7.  Garrett   County 7,499,394 

8.  Prince  George's  County 7,250.132 

9.  Dorchester   County 7,070,275 

10.  Carroll  County 6,619,525 

11.  Caroline    County 6,312,579 

12.  Harford   County 6,055,490 

13.  Wicomico  County 4,930,099 

14.  Worcester  County 4,579,747 

15.  Talbot    County 4,092.851 

16.  Frederick  County 3,742.958 

17.  Howard  County 3,685,807 

18.  Queen  Anne's  County 3,478,851 

19.  Somerset  County 3,399,705 

20.  Kent  County 2,754,314 

21.  Cecil  County 2,357,518 

22.  St.  Mary's  County 2,139,373 

23.  Charles  County 2,017,800 

24.  Calvert  County 624,055 

The  State 500,841,948 

27Personal    property    of    Maryland    corporations    not    included    in    this 
aggregate. 
^''See  note  at  beginning  of  this  article. 


ReASSESSMEXT  IX  Marylaxd 


209 


Table'"  Showing  Percentage  of  Increase  of  Assessments 
and    Personal    Property   and    Securities  from   1877 
inclusive. 

(REASSESSMENTS  IN   1877,  i897{and  1911.) 


of  Real 
to  191 2, 


Allegany 

Anne  Arundel... 
BaltimoreCity... 
Baltimore  Co.... 

Calvert 

Caroline 

Carroll 

Charles 

Cecil 

Dorchester 

Frederick 

Garrett 

Harford 

Howard 

Kent 

Montgomery 

Prince  George's, 
Queen  Anne's... 

St. Mary's 

Somerset 

Talbot 

Washington , 

Wicomico 

Worcester 


THE  STATE... 


Per  Cent. 

99 
112 

182 

25 

168 

40 

58 

17 
117 

14 

245 

22 
48 

36 
140 

79 

52 

73 
86 

50 

97 

no 

109 

104 


(29).    See  note  at  beginning  of  this  article. 


210  Report  of  the  Commission 


A  PARTICULAR  STUDY  OF  THE 
1910  REASSESSMENT. 

Further  examination  of  the  assessment  of  counties  showing 
an  increase  of  county  assessment  of  1911  as  compared  with 
1910  would  prove  that  the  increase  was  not  sudden,  but  of 
gradual  growth.  For  instance,  Allegany's  advance  of  $10,- 
000,000  did  not  accrue  in  values  to  that  county  in  one  year. 
It  was  an  evolution  of  values.  This  applies  to  all  counties 
which  show  a  marked  contrast  between  the  years  immediately 
preceding  and  following  the  reassessment,  such  as  Washington, 
Anne  Arundel,  Caroline,  Dorchester  and  Baltimore  Counties. 

Without  analyzing  at  this  time  the  ratio  of  assessment  to 
valuation,  consider  what  the  State  and  local  communities  have 
lost  in  the  way  of  taxes.  Local  county  assessments  and  State 
assessments  are  practically  the  same,  with  the  exception  of 
railroad  properties  added  to  county  assessments. 

Take  Allegany  County  for  illustration.  The  $10,000,000  in- 
crease should  be  distributed  over  fourteen  years,  and  any  cal- 
culation tending  to  show  what  the  State  has  lost  is  more  or  less 
theoretical,  and  not  conclusive. 

In  the  natural  course  of  events,  the  State  assessment  for  the 
year  1911  without  reassessment  would  have  shown  the  aver- 
age increase.  The  gross  increase  as  compared  with  the  pre- 
ceding year,  which  was  prior  to  the  return  of  the  new  assess- 
ment, was  $115,000,000  in  the  whole  State.  The  average  in- 
crease from  1897  to  1911  was  less  than  three  per  cent.,  and 
it  is  fair  to  assume  that  this  average  would  have  been  main- 
tained without  any  reassessment.  The  taxable  basis  for  1911 
would  consequently  have  been  $860,000,000  for  the  State, 
leaving  an  increase  directly  attributable  to  reassessment  of 
$91,000,000. 


Reassessment  in  Maryland 


211 


Distribute  this  over  the  fourteen  years,  and  charge  the  same 
with  the  State  rate  for  the  year,  and  we  have  a  result  some- 
thing like  this  for  each  year's  additional  income: 


Computed 

Assessment 

Based  on 

Average  Increase 

Between  Periods 

of  Reassessment. 

1898 $632,500,000 

1899 657,100,000 

1900 681,700,000 

1901 706,300,000 

1902 730,900,000 

1903 755,500,000 

1904 780,100,000 

1905 804,700,000 

1906 829,300,000 

1907 853,900,000 

1908 878,500,000 

1909 903,100,000 

1910 927,700,000 


What  the  assessment  should  have  been  is  derived  by  charging 
a  constant  increase,  uniform  throughout  the  years  between  the 
periods  of  reassessment.  The  actual  increase  of  assessment  for 
State  purposes  has  not  been  constant;  in  fact,  immediately  fol- 
lowing reassessment  there  was  a  decided  loss.  The  difference  of 
assessment  upon  which  is  computed  the  State  loss  by  applying 
the  rate  is  the  actual  difference  from  what  was  assessed  and  the 
computation  of  what  should  be  the  assessment. 

The  result  is  not  flattering,  at  least,  and  far  from  pleasing,  if 
we  even  allow  for  vast  discrepancies ;  but,  nevertheless,  the  study 
is  instructive  as  a  guide  for  future  action.  Beginning  now  after 
reassessment,  the  attention  directed  to  this  condition  should  point 
to  a  better  method  of  assessment. 


Computed 

State  Rate 

Increase 

Per  Hundred 

State  Loss 

of  Assessment. 

(Cents.) 

of  Taxes. 

$29,200,000 

17% 

$51,830.00 

45,600,000 

17% 

80,940.00 

65,000,000 

17% 

115,375.00 

62,500,000 

17 

106,250.00 

64,100,000 

17 

108,970.00 

82,200,000 

17 

139,740.00 

99,400,000 

221/2 

223,650.00 

99,200,000 

231/2 

233,120.00 

90,600,000 

231/2 

212,910.00 

88,800,000 

16 

142,080.00 

81,600,000 

16 

130,560.00 

102,300,000 

16 

163,680.00 

91,100,000 

16 

145,760.00 
30$1,854,865.00 

30Allowance    must    be    made    for    failure    in    collections.     See    post- 
"Collection  of  Taxes." 


212  Report  of  the  Commission 


FURTHER   CONSIDERATION   OF  THE   REASSESS- 
MENT ACT  OF  1910. 

The  Act  of  1910  providing  for  a  general  reassessment  was 
passed  at  the  close  of  the  session.  It  was  too  late  to  be  of 
benefit  for  the  State  basis  of  that  year,  but  it  was  contem- 
plated that  by  1911  the  whole  would  have  been  completed  for 
use  in  levying  the  State  tax.  Baltimore  City,  owing  to  its 
continuing  assessment  and  the  mandate  requiring  a  revision 
of  all  property  every  five  years,  was  exempted,  as  were  Somer- 
set and  Worcester  Counties  owing  to  reassessments  in  1908. 

All  other  counties  were  consequently  within  the  mandate  of 
the  law,  but  for  some  reason  or  other  four  counties  failed  to 
report  by  1911,  and  the  levy  was  laid  on  the  former  basis.  Had 
there  been  some  central  State  agency  compelling  them  to  com- 
ply, there  would  have  been  direct  responsibility.  The  counties 
that  failed  to  report  were  Cecil,  Garrett,  Kent  and  Talbot. 
Three  of  these — Cecil,  Garrett  and  Kent — had  not  reported  by 
January,  1912,  in  time  for  that  year's  assessment,  according  to  the 
report  of  the  State  Tax  Commissioner  to  the  Legislature,  although 
the  change  of  assessment  between  1911  and  1912  would  in- 
dicate that  they  may  have  levied  on  a  new  assessment. ^^ 

The  Comptroller  of  the  State  in  his  annual  report  for  the 
fiscal  year  1912,  which  was  submitted  to  the  session  of 
the  General  Assembly  at  the  beginning  of  the  session,  drew 
attention  to  this  fact  by  the  following  statement : 

Page  IX.  "The  new  assessment  of  1910  increased  the  basis 
from  $836,665,067  in  1910  to  $951,926,271  in  1911,  or  an  in- 
crease of  $115,261,204,  despite  the  fact  that  several  counties, 
viz,  Garrett,  Kent,  Cecil  and  Talbot,  levied  and  collected  the 
1911  levy  on  the  old  basis  of  assessment.  Therefore,  these 
counties  do  not  show  the  new  basis,  but  the  old.  Had  these 
counties  completed  their  assessments  as  required  by  law,  the 
present  basis  would  be  much  larger,  and  the  State  and  counties 
would  have  derived  the  benefits  accruing  therefrom.     Such  a 

siUnder  date  of  January  7,  1913,  the  State  Tax  Commissioner  reported 
to  this  Commission  that  Cecil  and  Garrett  had  not  at  that  time  filed  their 
assessment,  and  that  Kent  filed  its  report  January  19,  1912. 


Reassessment  in  Maryland  213 

course  was  not  fair  or  equitable  to  the  other  counties,  and  the 
local  taxing  authorities  of  such  delinquents  are  guilty  of  gross 
laches  in  not  being  more  expeditious  in  the  performance  of 
their  duties." 

If  this  was  a  reprimand,  that  is  all  there  was  to  it.  Local  tax- 
ing authorities  are  not  over-sensitive,  and  there  was  no  agency  to 
compel  compliance  nor  any  action  to  bring  the  delinquents  to 
account.^^ 

The  amount  of  tax  receipts  lost  by  this  neglect  is  speculative, 
though  considerable.  However,  a  most  important  principle  is 
involved,  because  it  is  fundamental  that  every  person  should  con- 
tribute to  the  support  of  the  government  according  to  the  actual 
worth  of  his  real  and  personal  property. 

Additional  Bibliography : 

Adams,  Thomas  S. :  "Taxation  in  Maryland." 

Bankard:  "Taxation  Under  the  New  and  Old  Assessment  Laws"  (1897). 

Richard  M.  McSherry:  "Talks  on  Taxation  in  Maryland." 


32A  similar  neglect  occurred  in  1841,  but  the  Legislature  of  1842  passed 
a  law  requiring  the  authorities  in  default  to  report  immediately  taxes  to  be 
collected  after  a  semi-annual  period.     (Chapter  116.) 


214  Report  of  the  Commission 


COST  OF  RE-ASSESSMENT  OF  THE  COUNTIES 
UNDER  THE  ACT  OF  1910. 

Allegany $32,000.00 

Anne  Arundel 14,884.23 

Baltimore  34,451.23 

Calvert   2.933.05 

Caroline    5,764.88 

Carroll    16,951.63 

Cecil    10,000.00 

Charles   4,171.00 

Dorchester  17,239.44 

Frederick   27,199.19 

Garrett   6,795.52 

Harford   12,471.05 

Howard    4,723.20 

*Kent 

Montgomery 1 1,000.00 

Prince  George's 13,933.94 

Queen  Anne's 8,367.71 

tSomerset  3,410.00 

St.  Mary's 7,158.85 

*Talbot 

Washington   29,199.89 

'  Wicomico 8,412.03 

tWorcester   5,000.00 


$276,066.80 


*  No  report. 

tRe-assessnient  in  1909. 

(The  cost  of  re-assessment  in  1896  in  Baltimore  was  $186,000.) 


Reassessment  in  Maryland 


215 


ASSESSORS   EMPLOYED   IN   REASSESSMENT   OF   1910. 


Number 
County.  Employed, 

Allegany   35 

Anne  Arundel 9 

Baltimore    County...  Zl 

Calvert    5 

Caroline   16 

Carroll    22 

Cecil    

Charles    12 

Dorchester  27 

Frederick   49 

Garrett    16 

Harford    

Howard    9 

Kent    10 

Montgomery   19 

Prince  George's ZT) 

Queen  Anne's 

St.    Mary's 13 

Somerset    3 

Talbot   7 

Washington  44 

Wicomico  18 

Worcester    10 

*  No  report. 


Occupations  of  Assessors. 
Not  classified. 

6  farmers,  2  merchants,  1  clerk. 
Farmers,  mechanics,  carpenters,  merchants. 

4  farmers,  1  merchant. 
Farmers,  canners,  merchants. 
"Mostly   farmers." 

11  farmers,  1  school  teacher. 

24  farmers,  1  doctor,  1  merchant,  1  real  es- 
tate agent. 

Not  classified. 

All  farmers. 

* 

5  farmers,  1  butcher,  1   builder,   1   weigher. 
1  clerk. 

7  farmers,  2  mechanics,  1  clerk. 

16  farmers,  2  contractors,  1  architect. 
* 

All  farmers. 

All  farmers. 

1   farmer,  1  lumberman,  1  merchant. 

4  farmers,  2  merchants,   1  attorney. 

"Farmers,    auctioneers,    merchants,     school 
teachers,  doctors,  gentlemen  of  leisure." 

Not  classified. 

4  farmers,  3  mercliants,  etc. 


Collection  of  Taxes  217 

COLLECTION  OF  TAXES. 

The  subjects  of  assessment  and  collection  are  so  closely  related 
and  dependent  that  it  has  seemed  necessary  to  make  a  thorough 
investigation  into  collection  methods  at  some  length. 

The  fiscal  control  of  the  State  of  Maryland  is  vested  to  a 
large  extent  in  the  Comptroller  of  the  Treasury  and  the  State 
Treasurer.!  It  would  appear  as  though  the  framers  of  the  Con- 
stitution contemplated  that  the  Comptroller  should  be  the  finan- 
cial adviser  of  the  State,  and  not  the  bookkeeper. 

He  is  charged  with  the  duty  of  making  all  estimates  and  fur- 
nishing the  Legislature  with  information  to  fix  the  tax  rate. 

As  far  as  investigation  goes,  there  has  never  been  an  audit  of 
collection  accounts  of  local  communities,  except  at  the  instance 
of  local  officers,  and  there  is  no  specific  authority  for  such  audit, 
except  for  Baltimore  City.  The  duties  of  the  State  Auditor  do 
not  require  him  to  audit  books  of  collectors  of  taxes. 

CHANGES  IN  THE  MANNER  OF  COLLECTING  TAXES. 

In  any  discussion  of  taxation  in  Maryland,  when  a  study  is  at- 
tempted of  condition  in  the  past,  it  must  constantly  be  borne  in 
mind  that  a  State  tax  has  not  always  been  imposed,  because  a 
direct  property  tax  was  an  exception  rather  than  the  rule.  In- 
deed, until  the  year  1841  a  direct  property  tax  was  very  seldom 
imposed. 

The  first  imposition  of  any  tax  occurred  in  1777.  and  it  is  sig- 
nificant that  the  first  act^  recognized  the  urgent  need  of  the  funds 
and  allowed  a  discount. 

This  discount,  however,  was  different  from  discounts  at  present 
allowed  in  Maryland  and  was  a  6%  allowance  paid  by  the  State 
for  the  use  of  money  in  advance.  It  was  distinctly  a  commer- 
cial discount.  Not  only  were  current  bills  discounted,  but  taxes 
for  future  years  were  discounted^  in  order  that  the  State  could 
obtain  large  sums  of  money. 


iConstitution    (1867),  Article  6,  Section  1. 

2Acts  1777,  Chapter  21,  Section  29. 

"Tax  Commission  Report  (1888),  page  CXLVIII. 


218  Report  of  the  Commission 

Taxes  under  the  first  levies  were  payable  semi-annually  ;•*  but 
as  their  amount  decreased,  the  provisions  of  law  for  two  pay- 
ments were  changed.  Until  1874  (Act  1874,  Chapter  483,  Sec- 
tion S3),  corporations  paid  taxes  semi-annually. 

The  Sheriff  was  the  first  collector  of  State  taxes  in  Maryland. 
After  the  tax  necessities  of  the  Revolutionary  War  had  been  pro- 
vided for,  the  direct  tax  was  not  imposed  until  1812. 

The  provisions  of  the  Act  of  1812-"'  followed  closely  those  of 
1777,  except  that  there  were  no  provisions  for  semi-annual  pay- 
ments. The  greatest  changes,  however,  in  the  manner  of  col- 
lecting taxes  occurred  about  1822,^  when  a  direct  property  tax 
was  levied  once  more,  after  having  been  suspended  for  years. 
This  act  established  a  system  different  from  that  heretofore  in 
force  and  provided  for  a  levy  of  a  fixed  amount  on  each  county, 
which  should  be  paid  to  the  State  free  of  all  costs  of  collections 
and  other  charges.  Heretofore  rates  per  cent,  on  $100  of  valua- 
tion were  levied  on  the  assessed  value  of  each  county.  This 
manner  of  levying  taxes  was  resorted  to  but  four  times,'''  although 
a  fixed  sum  was  levied  occasionally  on  the  communities  for 
special  purposes  in  subsequent  years. 


•*See  Act  ]777  above  referred  to. 

sChapter  191. 

BChapter  53. 

7The  amount  levied  in  each  county  was  as  follows  for  the  year  1823,. 
when  the  charge  was  the  heaviest: 8 

Allegany    $948 

Anne  Arundel  3,924 

Baltimore  County* 19,468 

Calvert    964 

Caroline    900 

Charles    2,696 

Cecil    2,380 

Dorchester   2,204 

Frederick    5,668 

Harford    2,140 

Kent    1,686 

Montgomery   2,044 

Prince  George's    3,076 

Queen  Anne's   2,252 

St.   Mary's    1,580 

Somerset    2,216 

Talbot    1,656 

Washington    2,948 

Worcester    1,964 

$60,714 
(Carroll,    Garrett,   Howard    and    Wicomico    Counties    and    Baltimore 
City  were  formed  subsequently.) 
SActs  1822.  ch.  139. 
♦Includes  Baltimore  City. 


Collection  of  Taxes  219 

The  reason  that  the  levying  of  taxes  in  this  manner  was 
changed  and  a  rate  fixed  instead  of  a  definite  lump  sum  can  prob- 
ably be  attributed  to  the  same  influences  which  brought  about  the 
change  of  law  which  resulted  in  the  consoHdation  of  the  offices 
of  the  "Levy  Court  of  the  County"  and  the  "Commissioner  of  the 
Tax  for  the  County"  into  one  body  of  County  Commissioners.^ 
The  officials  of  the  Levy  Courts  were  appointed  by  the  Governor 
and  Council,  while  the  Commissioner  of  the  Tax  was  appointed 
by  the  Legislature.  Lentil  this  consolidation  was  brought  about 
there  was  direct  .^tate  responsibility  on  the  part  of  the  central 
appointees. 

A  striking  efl:'ect  of  the  change  from  central  control  to  local 
control  is  seen  about  the  year  1841  in  the  difficulty  of  the  State  in 
collecting  its  revenues.  This  was  the  period  of  financial  crisis 
in  Maryland  State  afifairs,  brought  about  by  State  aid  to  public 
improvements  and  when  the  needs  of  prompt  collections  were 
imperative.  But  local  collecting  officers  under  local  influence- 
failed  to  realize  the  importance  of  prompt  collections,  and  con- 
cerned themselves  with  local  financial  affairs  to  the  detriment  of 
the  State. 

The  advisability  of  levying  a  sum  of  money  upon  each  county 
oased  upon  the  percentage  of  its  assessable  value  to  the  assessable 
value  of  the  State  is  deserving  of  some  consideration,  and  is  the 
method  followed  in  nearly  all  other  States.  In  Maryland,  after  the 
rate  has  been  computed  and  the  assessed  valuation  of  each  county 
ascertained,  the  amount  of  taxes  is  then  charged  not  as  against 
each  county,  but  as  against  the  individual  holders  of  property  in 
each  county.    The  collection  is  then  left  to  local  officers. 

The  detail  of  the  collection  system  is  discussed  under  the  fol- 
lowing heads : 

Percentage  of  collection  of  taxes  by  local  authorities. 

Methods  and  costs  of  collection. 

Dates  when  local  taxes  are  due. 

Discount.    Interest.    Penalties. 

Insolvencies. 


OThe  first  act  was  the  Act  of  1826,  chapter  217,  appMcable  to  Balti- 
more County.  The  change  in  each  county  was  brought  about  by  a; 
separate  act. 


220 


Report  of  the  Commission 


PERCENTAGE  OF  COLLECTION  OF  STATE  TAXES  OF 
THE  LOCAL  COMMUNITIES  OF  MARYLAND. 

The  taxable  basis  of  Alaryland  for  1912  was  $979,309,976,  and 
the  rate  levied  on  this  amount  was  23i/4c.  on  the  $100.  Conse- 
quently the  tax  on  real  and  personal  property  to  be  paid  by  col- 
lectors should  have  been  $2,276,895.69.  Under  the  provisions 
of  law^^  State  taxes  are  due  the  first  of  January  and  are  due  and 
payable  the  first  of  the  succeeding  January  and  bear  interest 
therefrom  at  6%. 

The  Comptroller's  year,  however,  does  not  coincide  with  the 
tax  year  and  ends  on  the  30th  of  September,  so  consequently  any 
report  of  collection  of  current  taxes  is  misleading  unless  this  dis- 
crepancy in  dates  is  taken  into  account ;  again,  too,  discount  must 
be  considered,  but  this  subject  is  treated  separately. 

In  1912,  according  to  the  report  of  the  Comptroller,  the  State 
received  on  account  of  taxes  of  1912  $1,581,224.36.  or  69.4%  of 
the  taxes  of  1912,  from  the  several  counties  and  city. 

The  following  table  shows  the  amount  of  the  levy  laid  on  the 
taxable  basis  of  each  county  in  1912,  the  amount  of  the  taxes  paid 
during  the  State  fiscal  year  on  account  of  such  levy  and  the 
percentage  of  collection  of  the  1912  taxes: 


Counties.  Levy. 

Allegany    $69,141.31 

Anne  Arundel   45,756.27 

Baltimore  City    1,200,587.88 

Baltimore   County    331,865.65 

Calvert    7,062.45 

Caroline   23,411.90 

Carroll    52,979.84 

Cecil    36,167.82 

Charles    12,718.45 

Dorchester    30,457.65 

Frederick    67,903.19 

Garrett    25,193.13 

Harford    40,832.56 

Howard    26,068.40 

Kent    23,721.08 

Montgomery    46,242.45 

Prince  George's   37,952.13 

Queen  Anne's  23,399.35 

St.  Mary's   11,760.02 

Somerset    17,063.30 

Talbot    28,365.00 

Washington    76,002.15 

Wicomico    21,876.86 

Worcester    " 20,366.85 

The    State $2,276,895.69 

iMaximum  that  can  be  collected  is  95%. 
Penalty. ) 

10  Article  81,  Section  48. 


Percentage 

of 

Collection. 

Collection.' 

$44,388.42 

.64 

25,000.00 

.54 

954,780.75 

.79 

203,727.74 

.61 

6,709.33 

.95 

0.00 

.00 

42,679.40 

.80 

0.00 

.00 

7,618.22 

.59 

10,000.00 

.32 

64,508.03 

.95 

12,000.00 

.47 

25,000.00 

.61 

10,461.18 

.40 

20,530.42 

.86 

25,000.00 

.54 

15,300.00 

.40 

3,442.84 

.14 

10,500.00 

.89 

1,378.03 

.08 

18,000.00 

.63 

50,000.00 

.65 

19,000.00 

.87 

11,200.00 

.55 

$1,581,224.36  .69 

(See  Interest,  Discount  and 


Collection  of  Taxes  221 

From  examination  of  the  above  table  showing  percentage  of 
collection  of  current  taxes,  it  appears  that  there  is  a  variance  of 
from  CX)%  to  95%,  and  this  condition  requires  a  full  investigation 
and  criticism  of  the  laws  and  administration  of  collection. 

In  this  connection,  must  be  taken  into  account  the  5%  discount 
to  September  1st,  the  4%  discount  to  October  1st  and  the  3%  dis- 
count to  November  1st.  and  the  dates  when  local  taxes  are  due. 

If  the  reason  for  this  delayed  payment  of  current  bills  is  the 
law  of  the  local  community  alone,  we  should  expect  percentage 
of  collection  in  the  counties  in  year  after  year  of  current  taxes 
to  be  uniform.  Howard  County  affords  a  fair  illustration  of  the 
manner  and  lack  of  uniformity  in  the  percentage  of  collection 
of  taxes. 

The  percentage  of  collection  of  current  taxes  in  Howard 
County  has  varied  from  81%  in  1902  to  21%  in  1908.  Frederick 
County  is  the  most  consistent  in  the  ratio  of  the  collection  of  cur- 
rent taxes,  as  it  has  collected  practically  95%  each  year  in  the 
last  ten  vears.  The  following  table  shows  the  percentage  of  col- 
lection? of  current  taxes  in  each  of  the  counties  and  Baltimore 
Citv. 


222 


Report  of  the  Commission 


Tablei  showing  the  percentage  of  collection-  of  current  State" 
taxes^  to  the  levy^  for  the  years  from  1902-1912,  inclusive: 


Allegany    

Anne  Arundel .  . 
Baltimore  City. 
Baltimore    Co.. 

Calvert     

Caroline    

Carroll    

Cecil    

Charles    

Dorchester    .  ... 

Frederick    

Garrett     

Harford    

Howard    

Kent   

Montgomery  . . 
Prince  George's 
Queen  Anne's. . 

St.   Mary's 

Somerset    

Talbot    

Washington    .  . . 

Wicomico    

Worcester    .  . . . 


1902 
.61 

1903 

.68 

.69 

.58 

.77 

.74 

.61 

.59 

.92 

.90 

.00 

.00 

.72 

.70 

.45 

.00 

.62 

.70 

.66 

.68 

.95 

.95 

.55 

.57 

.00 

.45 

.81 

.65 

.95 

.89 

.41 

.38 

.53 

.58 

.93 

.93 

.67 

.37 

1904 


1905 


.58 

.58 

.69 

.60 

.94 

.00 

.74j 

.40 

.701 

.68 

.95 

,68 

.41 

,40 


.63 
.62 
.72 
.63 
.94 
.00 
.78 
.40 
.69 
.37 
.95 
.83 
.41 
.34 


.901    .90 


,30! 

.90i 
.861 
.561 
.351 


.00 1 
.89| 
.85 1 
.53 1 
.671 


.31 
.40 
.91 
.93 
.01 
.90 
.95 
.00 
.61 


The  State..  I    .701    .691    .66 


.35 
.42 
.89 
.91 
.01 
.91 
.88 
.00 
.68 


.67 


1906 


.65 
.54 
.74 
.63 
.91 
.00 
.81 
.41 
.85 
.36 
.95 
.66 
.45 
.45 
.89 
.47 
.43 
.91 
.92 
.17 
.94 
.84 
,00 
.36 


,68 


1907 


.65 
.72 
.74 
.61 
.92 
.00 
.82 
.40 
.91 
.67 
.95 
.90 
.43 
.39 
.90 
.67 
.48 
.92 
.90 
.12 
.93 
.90 
.58 
.62 


72 


1908 


.64 

.73 
.71 
.61 
.96 
.00 
.93 
.40 
.94 
.70 
.95 
.81 
.42 
.21 
.82 
.66 
.46 
.86 
.91 
.00 
.93 
.88 
.95 
.89 


.69 


1909. 1910 


.64 
.71 
.76 
.60 
.89 
.00 
.87 
.00 
.90 
.67 
.95 
.76 
.42 
.51 
.83 
.64 
.51 
.90 
.91 
.08 


.62 
.57 
.78 
.63 
.92 
.00 
.88 
.00 
.58 
.66 
.94 
.80 
.42 
.33 
.80 
.4i9 
.48 
.84 
.96 
.06 


.86 1  .83 

.85]  .68 

.95|  .88 

.801  .58 


1911 


.60 
.35 
.80 
.64 
.90 
.00 
.76 
.00 
.62 
.00 
.94 
.58 
.39 
.34 
.74 
.46 
.42 
.87 
.73 
,07 
.65 
.64 
,95 
.60 


1912 


.64 
.54 
.79 
.61 
.95 
.00 
.80 
.00 
.59 
.32 
.95 
.47 
.61 
.40 
.86 
.54 
.40 
.14 
.89 
.08 
.63 
.65 
.87 
.55 


,711    .711    .691    .69 


Some  counties  return  to  the  State  from  year  to  year  the  iden- 
tical amount  of  current  taxes  irrespective  of  the  change  in  the 
State  tax  rate,  the  change  in  the  amount  of  assessable  property  of 
the  county  and  the  amount  of  taxes  which  the  county  has  to  pay. 

For  instance,  Montgomery  County  reported  exactly  $15,000  of 
collection  of  current  taxes  in  each  of  the  fiscal  years  1906,  1907, 
1908  and  1909,  notwithstanding  the  fact  that  levies  in  the  county 
in  those  years  varied  from  $22,191.50  to  $31,567.59. 

Harford  in  the  years  1907,  1908,  1909  and  1910  reported  the 
collection  of  $9,000  in  each  year.  Many  other  counties  show  such 
a  condition,  but  not  to  quite  such  a  marked  extent,  and  many  show 
payments  of  a  flat  amount  in  dollars  year  after  year.     Examina- 

iCompiled  from  reports  of  the  Comptroller. 

2Consideration  of  direct  property  taxes  includes  tax  on  real  estate, 
personal  property  and  securities. 

:'-State  taxes  are  payable  January  1st.  Discount  to  September  1st 
5%;  to  October  1st,  4%;  to  November  1st,  3%.  After  January  1st  in- 
terest is  chargeable. 

4  95%  is  maximum  that  can  be  collected,  as  State  fiscal  year  ends 
September  30th  and  all  taxes  collected  to  September  1  are  entitled  to 
5%  discount. 

•">State  taxes  are  collected  (with  some  exceptions)  with  local  taxes, 
and  fiscal  year  varies  in  different  counties. 


Collection  of  Taxes 


223 


tion  of  the  tables  of  collection  of  taxes  of  each  county  at  the 
end  of  this  article  demonstrates  to  what  extent  this  is  resorted  to. 

These  collections  are  summarized  in  a  table  showing  the  aggre- 
gate of  levies  and  the  aggregate  of  collections,  and  from  these  are 
computed  the  percentage  of  collections  of  the  counties. 

Table!  showing  aggregate  of  levies,-  amounts  of  collection  of 
current^"^  taxes;"*  amount  of  collections  of  all  taxes  levied  from 
1902  to  1912,  inclusive — (tax  on  Maryland  Corporations  and 
Baltimore  City  stock  not  included)  : 


. 

en  =»- 

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+->   O 

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a 

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3   m   .• 

S    to  X5 

ID 

amo 
ction 
taxes 

O    fl 

0-1 

O 

am 
ctio 
and 

<X> 

3^^. 

OJ    0)  _^ 

-i-> 

■^-l  •—'  -^ 

ci3 

rega 

col 

rren 

rega 

col 

irreri 

xes. 

bo 

bC!:!  -' 

M-ti    7<    TO 

bO 

M  °   " 

M  °   ^  -^ 

<! 

< 

< 

Allegany    

Anne  Arundel  .  .  . 
Baltimore  City  .  . 
Baltimore  County 

Calvert    

Caroline-'"'    

Carroll     

Cecil     

Charles    

Dorchester    

Frederick    

Garrett    

Harf  01  d     

Howard    

Kent    

Montgomery  .... 
Prince  George's  . 
Queen  Anne's    .  .  . 

St.   Mary's    

Somerset    

Talbot    

Washington     

Wicomico     

Worcester    


$448,435.16 

296,328.99 

9,486,732.16 

2,121.229.40 

52,733.36 

132,802.81 

389,426.98 

272,145.24 

84,548.61 

177,104.99 

481,170.48 

166,659.90 

299,256.18 

203,158.42 

175,468.17 

314,196.63 

273,321.70 

190,897.67 

78,030.31 

120,481.23 

192,543.53 

491,098.02 

140,244.50 

156,412.50 


$282,771.09 

172,200.00 

7,171,054.52 

1,312,921.55 

48,859.33 

0.00 

312,585.89 

57,966.58 

61,022.06 

79,700.00 

456,643.57 

113,050.00 

125,000.00 

87,677.67 

150,759.48 

153,623.01 

124,723.64 

153,382,52 

65,245.61 

9,193.97 

161,250.00 

391,192.55 

83,515.98 

83,980.00 


$391,617.21 

248,629.04 
8,573,442.07 
1,939,642.06 

49,370.56 
101,776.34 
353,288.29 
228,746.36 

75,346.63 
129,792.92 
456,643.57 
142,974.39 
275,089.80 
177,825.88 
162,534.93 
282,461.46 
233,749.75 
155,613.28 

72,401.51 

96,375.01 
167,907.45 
430,223.50 
131,358.78 
116,157.91 


The   State    $16,744,424.94        $11,658,318.54        $14,992,968.70 


iCompiled  from  reports  of  Comptroller  of  the  Treasury  from  1902 
to  1912,  inclusive. 

2Levies  in  report  include  those  on  real  property,  personal  property 
and  securities. 

sstate  taxes  are  due  January  1st.  Discount  to  September  1st,  5%; 
to  October  1st,  4%;  to  November  1st,  3%.  After  January  1st,  interest 
at  6%. 

•iState  taxes  are  collected  with  local  county  taxes,  and  fiscal  year 
varies  in  different  counties. 

5In  11  years  Caroline  County  has  not  reported  the  collection  of  any 
current  taxes. 


224  Report  of  the  Commission 

Table  1   showing  percentage-  of  collection"'   of  current^   State 
taxes'"^  to  total  levies  aggregated  from  1902  to  1912: 

Percentage. 

Allegany    63.0 

Anne  Arundel    58.1 

Baltimore   City    75.5 

Baltimore  County  61.9 

Calvert    92.6 

Caroline   00 

Carroll     80.2 

Cecil     21.3 

Charles    72.1 

Dorchester     44.3 

Frederick     94.9 

Garrett    67.8 

Harford    41.7 

Howard    43.1 

Kent    85.8 

Montgomery    48.9 

Prince  George's 45.6 

Queen  Anne's    80.0 

St.    Mary's    83.6 

Somerset     7.6 

Talbot    83.7 

Washington    79.6 

Wicomico     59.5 

Worcester    54.1 

The  State    69.6 

In  this  connection  reference  is  made  to  Table  13  of  the  annual 
report  of  the  Comptroller,  showing  taxes  due  from  collectors 
on  account  of  State  taxes. 

The  following  table  shows  the  collection  of  all  taxes  for  the 
fiscal  year  ending  September  30.  1912,  classified  as  to  payment  on 
account  of  each  year's  taxes. 


iFrom  reports  of  Comptroller. 

2Maximum  957^,  because  of  5%  discount  allowed  on  current  State 
taxes. 

^See  post.  Beginning  of  Fiscal  Year  in  the  Counties. 

estate  taxes  are  payable  as  of  1st  January.  Comptroller's  year  and 
reports  to  30th  September. 

^Includes  only  tax  en  real  and  personal  property  and  securities. 


Collection  of  Taxes 


225 


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226  Report  of  the  Commission 

From  this  table  it  appears  that  the  State  received  during  the 
last  fiscal  year  taxes  on  account  of  the  following  levies: 

Received  on  account  of  1912  taxes $1,581,224.36 

Received  on  account  of  1911  taxes 409,026.70 

Received  on  account  of  1910  taxes 52,730.22 

Received  on  account  of  1909  taxes 13,591.98 

In  addition,  the  State  also  receives  small  amounts  from  dif- 
ferent communities  on  account  of  taxes  levied  prior. 

This  table,  taken  in  conjunction  with  a  fuller  tabulation  at  the 
end  of  this  article,  is  interesting  as  showing  the  extent  of  delayed 
payments.  Calvert,  Frederick  and  Wicomico  Counties  reported 
collection  of  no  taxes   for  any  year  prior  to  the  current  year. 

In  regard  to  Wicomico  County,  it  would  appear  that  allowing 
the  full  57o  discount  on  account  of  all  taxes  there  were  still  some 
amounts  not  accounted  for.  As  regards  Frederick  County,  it  ap- 
pears that  in  every  year  taxes  are  promptly  paid  and  that  by 
October  the  first  of  each  year  all  taxes  for  that  year  have  been 
forwarded  to  the  Comptroller,  less  the  discount  allowed  by  law 
for  prompt  payments.  Calvert  County  collects  taxes  very 
promptly. 

But  with  these  considerations,  the  discount  methods  of  collec- 
tors  (which  are  discussed  later)  must  be  remembered. 

Caroline  and  Cecil  Counties  reported  the  collection  of  no  cur- 
rent taxes,  but  only  collections  of  1911  taxes. 

The  following  counties  in  addition  reported  collection  of  no 
other  taxes  than  those  levied  for  1911  and  1912: 

Anne  Arundel, 

Harford, 

Howard, 

Kent, 

Prince  George's,. 

St.  Mary's. 

In  this  connection  also  it  is  interesting  to  note  the  interest 
paid  by  counties,  which  is  hereinafter  set  forth,  and  the  relation 
of  discounts  to  the  aggregate  amounts. 


Collection  of  Taxes  227 

.METHODS  AND  COSTS  OF  COLLECTION  OF  STATE 

TAXES. 

State  taxes  are  collected  with  local  taxes  and  by  the  same  offi- 
cial collecting  local  taxes.  But  there  is  no  uniformity  in  the 
State  in  the  manner  of  making  collections. 

The  trend  today  is  toward  the  County  Treasurer  system.  The 
County  Treasurer  in  the  communities  which  have  adopted  this 
system  is  the  collector  of  all  taxes.  State  and  local,  and  also  clerk 
to  the  County  Commissioners.  In  most  communities  this  official 
receives  a  salary. 

In  some  other  counties  there  are  collectors  of  taxes  who  report 
directly  to  the  State  Comptroller  and  in  some  other  counties  col- 
lectors who  report  to  the  County  Treasurer,  who  in  turn  remits 
States  taxes  to  the  Comptroller. 

In  Alleganv  and  Worcester  Counties  there  are  three  collectors 
of  taxes  who  account  directly  to  the  State  Comptroller  for  State 
taxes  and  to  the  County  Treasurer  for  local  county  taxes.  In 
Carroll  County  there  are  fourteen  such  collectors  who  account 
for  State  revenue  to  the  State  Comptroller  and  to  the  County 
Treasurer  for  local  funds.  In  Dorchester  County,  though,  in 
each  of  the  seventeen  districts  there  is  a  district  collector  of  State 
and  county  taxes ;  all  taxes  are  forwarded  to  the  County  Treas- 
urer, who  in  turn  remits  State  taxes  to  the  State  Comptroller. 
Under  the  present  plan  in  Dorchester  County  it  is  impossible 
to  ascertain  from  the  County  Treasurer  if  taxes  have  been 
paid  on  a  piece  of  property  in  the  part  of  the  county  remote  from 
the  county  seat,  notwithstanding  the  fact  that  the  County  Treas- 
urer has  to  receive  this  money.  As  far  as  information  has 
reached  the  Commission,  this  last  condition  exists  only  in  Dor- 
chester County. 

THE  DISCOUNT  SYSTEM  OF  COLLECTORS. 

Article  81,  Section  48  of  the  Code  of  Public  General  Laws  pro- 
vides for  discount  as  follows : 

"All  persons  and  incorporated  institutions  that  shall  pay  their 
State  taxes  on  or  before  the  first  day  of  September  of  the  year 
for  which  they  were  levied  shall  be  entitled  to  a  deduction  of  five 


228  Report  of  the  Commission 

per  centum  on  the  amount  of  said  taxes ;  all  that  shall  pay  the 
same  on  or  before  the  first  day  of  October  of  the  said  year  shall 
be  entitled  to  a  deduction  of  four  per  centum,  and  all  that  shall 
pay  the  same  on  or  before  the  first  day  of  November  of  the  said 
year  shall  be  entitled  to  a  deduction  of  three  per  centum ;  and 
at  the  time  of  receiving  said  taxes  the  proper  officers  shall  make 
the  deductions  aforesaid  and  note  the  same  upon  the  receipts 
given  to  persons  or  incorporated  institutions  so  paying,  but  noth- 
ing contained  in  this  section  shall  extend  to  the  taxes  payable 
on  the  public  debt  of  Maryland  or  the  stock  loans  of  the  City  of 
Baltimore." 

Maryland  through  local  governing  bodies  levies  taxes  on  in- 
dividual property,  and  it  appears  that  some  local  collectors  act 
on  the  theory  that  the  collection  of  taxes  may  be  handled  as  best 
suits  their  own  convenience  rather  than  the  interest  of  the  State. 
It  would  not  be  possible  for  the  State  to  obtain  any  collector  if 
collectors  were  personally  charged  with  amount  of  taxes  due  from 
each  communit}^ 

The  State  taxes  are  levied  upon  each  piece  of  property  by  the 
County  Commissioners.  The  local  collector  is  notified  by  the 
Commissioners  of  the  assessment  of  the  individual  and  he  readily 
computes  the  amount  of  State  and  local  taxes.  This  officer 
makes  no  effort  to  collect  taxes  when  first  levied  because  the 
owner  gets  the  same  benefit  during  January  that  he  gets  in  Au- 
gust. At  the  end  of  August  he  estimates  what  accounts  are 
good  and  has  his  note  discounted  at  a  bank  for  the  difference 
between  the  amount  of  collected  taxes  and  the  amount  he  esti- 
mates will  be  collected,  and  then  sends  this  amount  to  the  State 
Comptroller.  The  collector  then  pockets  the  discount.  After  the 
discount  period  has  expired  he  makes  every  effort  to  collect 
taxes,  not  for  the  State  of  Maryland,  but  for  his  own  benefit. 

These  notes  are  easily  discounted,  are  well  secured  and  are 
termed  tax  notes.  In  some  parts  of  the  State  the  profits  have 
been  very  large. 

A  system  which  allows  such  a  condition  to  exist  is  woefully 
lacking  in  the  first  elements  of  sound  finance. 

In  Caroline  and  Wicomico  Counties  within  recent  years  the 
county  authorities  themselves  anticipate  the  payment  of  State 
taxes  and  thus  save  for  their  respective  counties  the  amount  of 


Collection  of  Taxes  229 

discount.     Wicomico  County  makes  it  within  the  5%   discount 
period,  and  Caroline  before  the  expiration  of  the  3%  period. 

COST  OF  COLLECTION. 

It  stands  to  reason  that  the  overhead  expenses  of  having 
fourteen  collectors,  as  in  Carroll  County,  and  three  collectors,  in 
Allegany  and  Worcester  Counties,  are  greater  than  the  expenses 
incident  to  a  single  collector  in  other  counties;  and  if  the  cost 
is  chargeable  to  the  person  as  an  additional  levy  or  paid  out  of 
county  funds,  the  result  is  the  same. 

There  is  no  longer  any  question  that  the  charge  of  State  col- 
lection can  be  made  a  charge  against  State  taxes  since  the  de- 
cision in  Allen  vs.  State. ^^  The  difficulty,  however,  that  this 
Commission  has  encountered  is  the  lack  of  any  audit  of  the  ac- 
counts of  local  collections.  Reliance  has  been  placed  on  pub- 
lished reports  of  the  State  Comptroller  and  special  reports  to  this 
Commission. 

But  attention  has  been  called  to  this  subject  by  recent  litigation 
m  Anne  Arundel  County,  when  attempt  was  made  to  charge  the 
expense  against  State  taxes. ^^ 

The  law  of  Maryland  is  set  out  in  Article  81,  Section  73,  and 
is  as  follows : 

"The  County  Commissioners  and  the  Mayor  and  City  Council 
of  Baltimore  shall  levy  upon  their  respective  counties  and  the 
City  of  Baltimore  such  commission  as  will,  in  their  judgment, 
insure  a  speedy  collection  of  said  taxes,  not  exceeding  5  per 
centum  on  the  amount  to  be  placed  in  the  hands  of  said  collectors 
for  the  counties  for  collection,  except  in  Calvert  County,  where 
it  shall  not  exceed  6  per  centum,  and  not  exceeding  2  per  centum 
on  the  amount  to  be  placed  in  the  hands  of  said  collector  for  the 
City  of  Baltimore;  said  commission  to  be  levied  for  the  use  of 
said  collectors,  respectively,  and  to  be  collected  as  other  charges 
are  collected.  The  Governor  shall  fix  the  commission  of  collectors 
appointed  by  him,  not  to  exceed  10  per  centum  on  the  amount 
placed  in  their  hands   for  collection ;  and  the  said  commissions 


11  98  Md.,  700. 

i2See  Cecil  vs.   Linthicum    (1913),  Circuit  Court  for  Anne  Arundel 
County. 


230  Report  of  the  Commission 

shall  be  levied  by  the  county  or  city  authorities,  or  by  the  tax 
board,  and  collected  by  said  collectors.  This  section  shall  not 
apply  to  Talbot  County." 

This  section  of  the  law  contemplated  imposing  additional  charge 
on  the  taxpayers,  but  this  is  seldom  resorted  to. 

The  only  communities  that  levy  on  property  a  commission  in 
addition  to  the  State  rate  in  order  to  pay  the  cost  of  collection 
are: 

Allegany,  2%. 

Baltimore  City,  ^  of  1%. 

Calvert,  5%. 

Charles,  5%. 

St.  Mary's,  10%. 

Worcester,  5%. 

The  County  Treasurers  are  paid  salaries,  forming  part  of  local 
expenditures,  and  in  some  communities  paid  commissions  from 
county  receipts. 

The  payment  of  a  commission  from  county  receipts  is  practi- 
cally the  same  as  a  payment  on  the  State  levy,  except  that  in  the 
former  the  charge  would  be  a  county  expense  when  it  should  be  a 
State  expense,  while  in  the  latter  the  charge  is  distinctly  a  State 
charge. 

The  commission  which  the  collectors  receive  varies  from  i/o  of 
1%  to  10%,  and  the  following  table  sets  out  the  information  in 
regard  to  the  cost  and  manner  of  collections. 

But  the  commission  is  levied  on  a  sum  that  is  constantly  chang- 
ing, owing  to  two  conditions — first,  the  change  in  State  tax  rate, 
and  second,  the  change  in  taxable  basis,  i/o  of  1%  levied  on  a  State 
rate  of  31  cents  on  the  $100  on  the  taxable  basis  of  Baltimore  City 
means  that  the  State  tax  for  Baltimore  is  $.31155;  a  commission 
of  5%  levied  on  the  taxpayers  in  those  counties  which  allow  such 
a  commission  means  a  State  rate  of  $.3255;  10%  commission 
means  a  State  rate  of  $.341.  In  some  counties  where  the  assess- 
able basis  has  increased  within  recent  years,  and  the  increase 
of  tax  rate  from  16  cents  as  in  1910  to  31  cents  in  1913,  the 
amount  of  commission  has  increased  considerably.  As  the  amount 
of  taxes  increased  the  fee  of  treasurers  or  collectors  increased. 
In  some  of  the  counties  and  Baltimore  City  collectors  receive  a 
salary  in  addition  to  the  commission. 


Collection  of  Taxes  231 


COMPARATIVE  STATEMENT  SHOWING  METHOD  OF 
PAYMENT  OF  COLLECTION  OF  TAXES  (Other  Than 
Commissions  Paid  in  Some  Localities  for  Collection  of  Local 
Taxes). 

Allegany 2%  commission  levied  on  taxpayer. 

Anne  Arundel    Salary  $1,200,  and  2%  commission  paid  out  of 

county  receipts  for  State  collection. 

Baltimore  City Salary    $2,000,    and    commission    of    %    of    1% 

levied  on  taxpayer  for  State  collection. 

Baltimore  County Salary  $3,000,  and  in  addition  commission  on 

taxes  distrained  for. 

Calvert 5%  commission  levied  on  taxpayer. 

Caroline  Salary  $1,200,  paid  out  of  county  receipts. $ 

♦Carroll 2%  to  3%%  commission  according  to  districts. 

Paid  out  of  county  receipts. 

Cecil Salary  paid  out  of  county  receipts. 

Charles Salary   $1,200,   and    5%    commission   levied   on 

taxpayer  for  State  collection. 

♦Dorchester Salary  $1,600,  paid  out  of  county  receipts. 

Frederick 1%  paid  out  of  county  receipts. 

Garrett 1%%  commission  paid  out  of  county  receipts. 

Harford  Salary  $1,500,  and  2%  commission  paid  out  of 

county  receipts  for  State  collection. 

Howard    Salary  paid  out  of  county  receipts. 

Kent    Salary  $1,500,  paid  out  of  county  receipts. 

♦Montgomery    Salary  $2,000,  paid  out  of  county  receipts. 

Prince  George's  Salary   $3,000;    3i^%    commission   paid   out   of 

county  receipts  for  State  collection. 

Queen  Anne's Salary  $1,800,  paid  out  of  county  receipts. 

♦Somerset Salary  $1,800,  paid  out  of  county  receipts. 

St.  Mary's Salary  $1,200,  and  10%  levied  on  the  taxpayer. 

♦Talbot Salary  $1,800,  paid  out  of  county  receipts. 

Washington Salary  $3,300,  paid  out  of  county  receipts. 

♦Wicomico Salary  $1,800,  paid  out  of  county  receipts. 

♦Worcester 5%  commission  levied  on  taxpayer  for  county 

and  State  collection. 


(Salary  of  County  Treasurer  in  Carroll  is  $1,500.) 
(Salary  of  County  Treasurer  in  Worcester  is  $1,200.) 
(Salary  of  County  Treasurer  in  Allegany  not  reported.) 
♦County  Treasurer  is  clerk  to  County  Commissioners. 
tCommission  of  3%  allowed  on  collections  after  March  of  following 
year. 

(Note. — From  reports  of  county  oflBcials  to  the  Commission  for  the 
Revision  of  the  Taxation  System  of  the  State  of  Maryland  and  City  of 
Baltimore.) 


232 


Report  of  the  Commission 


As  stated  before,  county  taxes  are  paid  at  the  same  time 
as  local  taxes  and  the  time  for  payment  of  local  taxes  is  fixed  by 
local  laws  applicable  to  the  particular  county. 

The  method  of  fixing-  such  a  time  by  the  Legislature  has  been 
followed  without  any  definite  policy,  and  the  State  now  has  a 
condition  that  is  hardly  conceivable. 

The  following  table  shows  dates  when  taxes  are  levied  and 
when  they  may  first  be  paid : 

COMPARATIVE    STATEMENT    SHOWING    DATE    OF 

BEGINNING  OF  FISCAL  YEAR;  ALSO  DATE  WHEN 

LOCAL  TAXES  MAY  FIRST  BE  PAID. 


Fiscal  Year. 


Collections  Begin. 


Allegany 

Anne  Arundel  .  . .  . 
Baltimore  City  . . . 
Baltimore  County. 

Calvert  

Caroline  

Carroll 

Cecil 

Charles 

Dorchester 

Frederick 

Garrett 

Harford 

Howard    

Kent 

Montgomery    

Prince  George's  .  . 
Queen  Anne's   .  .  .  . 

Somerset 

St.  Mary's   

Talbot 

Washington    

"Wicomico 

Worcester    


3d  Tuesday  in  April. 

1st  July. 

1st  January. 

1st  May. 

1st  July. 

1st  July. 

15th  June. 

1st  September. 

1st  July. 

1st  July. 

1st  July. 

1st  April. 

1st  May. 

1st  June. 

12th  June. 

1st  July. 

Last  Monday  in  March. 

1st  June. 

1st  July. 

1st  August. 

1st  July. 

15th  June. 

1st  July.    • 

1st  June. 


June. 

1st  July. 

1st  January. 

May. 

1st  August. 

1st  July. 

15th  June. 
* 

1st  July. 
15th  August. 
1st  July. 

2d  Tuesday  in  April. 
1st  June. 
August. 
1st  August. 
1st  July. 
1st  May. 
1st  August. 
1st  Tuesday  in  July. 
1st  August. 
1st  July. 
15th  June. 
20th  July. 
20th  August. 


*No  report. 

Note. — From  special  reports  made  to  the  Commission. 


Collection  of  Taxes  233 

DISCOUNT,  INTEREST  AND  PENALTIES. 

State  taxes  are  due  the  first  of  January  in  the  year  in  which 
they  are  levied  and  under  the  law  shall  be  considered  in  arrears 
on  the  first  of  January  next  succeeding  the  date  of  their  levy. 

Taxes  paid  on  or  before  the  first  day  of  September  of  the  year 
for  which  they  are  levied  are  entitled  to  a  reduction  of  5%  dis- 
count;  if  paid  on  or  before  the  first  day  of  October,  4%;  and  if 
paid  on  or  before  the  first  day  of  November.  3%. 

Effort  has  been  made  to  ascertain  the  discount  loss  to  the 
State  in  any  one  year,  but  without  success,  owing  to  the  fact  that 
the  fiscal  year  of  the  State  begins  the  first  of  October,  and  all 
taxes  collected  after  that  date  may  or  may  not  be  paid  within  the 
discount  period.  This  information  is  therefore  difficult  to  ascer- 
tain. 

The  following  table  shows  the  amount  of  the  discount  loss 
to  the  State  in  the  year  1912  to  the  30th  of  September,  but  in  con- 
sidering such  table  it  must  be  borne  in  mind  that  the  aggregate 
should  be  increased  by  discounts  to  the  first  of  November : 

Allegany-'     $1,952.71 

Anne  Arundel  1,315.79 

Baltimore  City   51,209.08 

Baltimore  County    11,614.73 

Calvert    353.12 

Carolines    1,000.00 

CarrolH    2,069.89 

Cecil     788.41 

Charles    432.08 

Dorchester    278.00 

Frederick    3,395.16 

Garrett    631.58 

*Harford     

Howard    834.01 

Kent     1,085.55 

Montgomery    1,941.51 

Prince  George's    1,048.09 

Queen  Anne's    262.28 

Somerset    210.76 

*St.  Mary's    

Talbot    947.37 

Washington    2,508.52 

Wicomico    1,000.00 

*  Worcester    

$84,878.64 


-Second  District  missing.  ^Two  districts  missing. 

^Estimated  by  county  officials.  *No  report. 


234  Report  of  the  Commission 

The  act  now  on  the  statute  books  was  passed  in  \847^^  and  has 
remained  the  same  without  any  change.  Corporations  also  are 
allowed  discounts  for  prompt  payment. 

Amount  of  discount  on  State^  taxes  to  October  1,  1912,  on 
account  of  1912  taxes  of  the  counties  of  Maryland  and  Baltimore 
City  as  reported  by  local  collectors  to  the  Commission  for  the 
revision  of  the  tax  laws — (no  report  received  of  discount  in 
October  and  November)  . 

INTEREST. 

Under  Ihe  law  interest  is  payable  on  taxes  after  the  first  of 
January  from  the  year  in  which  levied  and  are  not  considered  by 
the  Comptroller  as  part  of  taxes,  but  are  carried  into  receipts  of 
the  State  under  separate  head  of  interest. 

The  following  table  shows  the  amount  of  interest  paid  by  the 
several  communities,  and  it  is  a  significant  fact  that  Calvert,  Caro- 
line, Frederick,  Howard  and  St.  Mary's  Counties  paid  no  interest 
on  deferred  taxes  to  the  State  during  the  past  year. 

In  this  connection  attention  is  directed  to  the  last  paragraph 
of  the  section  concerning  the  payment  of  interest,  which  reads  as 
follows : 

"This  section  shall  not  apply  to  Harford,  Garrett  or  Talbot 
Counties." 

The  full  import  of  these  words  is  not  exactly  clear,  and  no  ex- 
planation has  been  given  to  the  section.  It  would  appear  as 
though  Harford,  Garrett  and  Talbot  Counties  are  not  required 
under  the  law  to  pay  any  interest  on  deferred  State  taxes. 

The  question  as  to  whether  interest  paid  on  taxes  in  arrears 
is  interest  or  taxes  would  seem  to  be  a  legal  question  for 
determination. 

Amount  of  interest  paid  on  account  of  taxes  in  arrears  by 
collectors  of  State  taxes  of  the  several  counties  and  City  of 
Baltimore  to  the  Comptroller  of  the  State  from  October  1,  1911, 
to  September  30,  1912: 


iTaxes  paid  on  or  before  September  1st  are  subject  to  5%  discount; 
1st  of  October,  4%;  and  1st  of  November,  3%. 
13  Chapter  266. 


Collection  of  Taxes  235 

Allegany    $544.19 

Anne   Arundel    410.52 

Baltimore  City   6,374.92 

Baltimore   County    756.12 

Calvert    

Caroline    

Carroll     55.41 

Cecil    296.50 

Charles    10.53 

Dorchester     316.22 

Frederick    

Garrett    25.03 

Harford     8.61 

Howard    

Kent    28.33 

Montgomery    576.47 

Prince  George's    19.98 

Queen  Anne's    84.87 

St.   Mary's    

Somerset    323.19 

Talbot   164.97 

Washington    409.85 

Wicomico    627.51 

Worcester    484.47 


Total    $11,517.69 

(From  Report  of  State  Comptroller  of  Maryland  to  Commission  for 
Revision  of  the  Tax  Laws.) 

(Where  no  amounts  are  set  out,  counties  paid  no  interest.) 

There  is  no  provision  of  the  law  concerning  payment  of  a  pen- 
alty on  State  taxes,  although  local  communities  impose  penalties 
in  many  cases  in  the  nature  of  a  flat  charge,  which  once  incurred 
remains. 

In  this  connection  attention  is  directed  to  the  fact  that  taxes 
in  Maryland  are  not  a  preferred  claim,  except  in  administra- 
tion of  decedent's  estate  the  executors  or  administrators  are  re- 
quired to  pay  all  taxes  due  from  their  decedents  as  preferred 
claims  and  to  the  exclusion  of  all  others  except  the  necessary 


236  Report  of  the  Commission 

funeral  expenses.  In  proceedings  in  equity  cases  it  is  neces- 
sary for  officials  to  file  claims  for  the  allowance  of  such  taxes.^* 
The  matter  is  more  or  less  far-reaching-,  and  unless  the  claim  is 
made  a  preferred  claim  and  a  lien  in  bankruptcy  cases  in  Federal 
courts,  the  State  and  local  communities  are  likely  to  lose  the 
amount  thereof. 

The  New  York  law,  as  at  present  applied,  allows  a  period 
within  which  taxes  can  be  paid,  and  after  the  expiration  of  said 
period  imposes  a  penalty  in  the  way  of  an  interest  charge  of 
7%,  so  consequently  it  is  not  to  the  advantage  of  any  person  to 
allow  their  taxes  to  be  in  arrears,  but  to  the  advantage  of  tax- 
payers to  borrow  at  6%  and  pay  taxes  and  save  I7c. 

INSOLVENCIES. 

This  term  has  a  local  meaning  in  Maryland  communities  and 
applies  to  the  assessments  on  personal  property  which  the  local 
taxing  authorities  consider  cannot  be  collected. 

It  is  not  possible  to  distinguish  under  the  present  system  what 
part  of  failures  of  collections  is  due  to  the  failure  on  real  estate 
and  what  part  to  personal  property.  The  law  authorizes  the  State 
Comptroller  to  allow  to  local  collectors  for  insolvencies  or  re- 
movals, but  it  apparently  has  been  the  practice  of  County  Com- 
missioners at  the  time  that  they  allow  for  insolvencies  on  account 
of  local  collections  to  also  allow  for  insolvencies  on  State  col- 
lections. 

The  laws  concerning  the  forced  collection  of  taxes  varies  prac- 
tically with  every  county  and  the  time  in  which  the  sale  must  be 
made.  The  number  of  years  of  arrearages  of  taxes  to  allow  a 
sale,  together  with  the  law,  is  very  complicated,  and  it  has  been 
impossible  to  get  reports  from  local  communities  governing  the 
same.  In  some  communities  properties  are  sold  if  taxes  are  one 
year  in  arrears. 

Taxes  in  arrears  arising  from  assessments  on  personal  property 
are  usually  obtained  by  distraint,  but,  again,  there  is  no  uniform- 
ity throughout  the  State. 


14  Blakistone  vs.  State,  117  Md.,  23'i 


Collection  of  Taxes  237 

COLLECTION  OF  OTHER  REVENUES. 

State  taxes  on  shares  of  stock  of  Maryland  corporations  are 
paid  by  the  corporations  directly  to  the  State  Comptroller,  and 
the  corporations  have  the  right  to  deduct  the  amount  thereof  from 
each  stockholder  at  the  time  of  paying  a  dividend,  but  the  taxes 
are  due  the  first  of  January,  and  in  many  cases  assessments  are 
not  computed  by  the  State  Tax  Commissioner  until  several  months 
later.  The  amount  of  insolvencies  of  Maryland  corporations  are 
apparently  large. 

The  following  table  shows  the  percentage  of  collections  of 
current  taxes  levied  against  Maryland  corporations  for  the  fiscal 
years  1905  to  1912,  inclusive : 

1905 76% 

1906 86% 

1907 75% 

1908 70% 

1909 66% 

1910 70% 

1911 72% 

1912 67% 

Of  course,  allowances  must  be  made  for  discounts  to  which 
they  are  entitled  and  to  difiiculties  obtained  in  ascertaining  the 
assessment  in  time  for  payment  of  current  years. 

Gross  receipts  taxes  are  also  paid  directly  to  the  State  Comp- 
troller and  are  due  on  or  before  the  first  day  of  July  in  each  and 
every  year,  and  after  a  month's  allowance  are  required  to  pay  a 
penalty  of  5%. 

The  collection  of  revenue  of  Clerks  of  Courts,  Sheriits,  Regis- 
ters of  Wills  (including  collateral  inheritance  taxes)  properly 
belongs  to  the  discussion  of  the  fee  system,  and  is  therefore  not 
treated  under  the  discussion  of  collection  of  taxes. 


COLLECTION  OF  STATE  TAXES  OF  EACH  OF  THE 
COUNTIES  OF  THE  STATE  AND  BALTIMORE 
CITY 

FROM  1902  TO  1912 

(INCLUSIVE) 


Tables*  showing  collection  of  taxes  of  each  of  the  counties  of 
Maryland  and  Baltimore  City  for  each  year  from  1902  to  1912, 
inclusive,  with  arrangement  of  each  year's  taxes  credited  to  the 
year  in  which  paid,  and  the  total  taxes  levied  upon  each  county 
and  Baltimore  City. 

Also  showing  the  aggregate  of  levies  and  aggregate  of  collec- 
tion of  taxes  for  these  years,  with  percentage  of  collection  for 
the  same  period. 

(The  amounts  in  the  vertical  columns  show  payments  on  ac- 
count of  levies;  the  amounts  in  the  horizontal  columns,  the  pay- 
ment in  the  State's  fiscal  year.) 


*The  State  allows  a  discount  of  5  per  cent,  if  taxes  are  paid  on  or  before 
the  first  day  of  September  of  the  year  for  which  levied,  4  per  cent,  if  paid 
on  or  before  the  first  dav  of  October,  and  3  per  cent,  if  paid  on  or  before 
the  first  day  of  November.  The  taxes  in  this  compilation  are  the  net 
amount.  Discount  is  not  reported,  but  net  amount.  Interest  on  deferred 
taxes  is  not  included. 


239 


240 


Report  of  the  Commission 


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Taxation  of  Corporations  265 


TAXATION  OF  CORPORATIONS^^ 

The  present  law  for  the  taxation  of  corporations  was  passed 
in  the  year  lS78,i  and  since  then  there  has  been  little  if  any 
change  in  the  manner  of  their  taxation,  notwithstanding  the  fact 
that  the  development  of  ordinary  business  corporations  has  oc- 
curred almost  entirely  within  recent  years. 

The  subject  of  taxation  of  corporations  is  a  large  one,  and  it  is 
necessary  to  confine  the  discussion  wnthin  reasonable  limits. 

To  acquire  a  knowledge  of  the  subject  the  different  manner  of 
taxing  domestic  and  foreign  corporations  must  be  borne  in  mind. 

The  real  estate  of  all  corporations,  domestic  and  foreign  (ex- 
cept railroad  companies)  is  taxed  for  State  and  local  purposes  in 
the  same  manner  as  the  real  estate  of  individuals.  The  personal 
property  of  foreign  corporations  is  taxed  like  that  of  an  in- 
dividual. 

The  real  estate  (and  also  the  personal  property)  of  railroad 
companies  is  taxable  for  local  purposes,  but  not  for  State  pur- 
poses. The  tax  on  gross  earnings  is  treated  as  in  lieu  of  the 
State  tax  on  property.  The  shares  of  railroad  companies  paying 
the  State  gross  receipts  tax  and  local  taxes  on  real  and  personal 
property  are  exempt  from  both  local  and  State  taxation. 

The  shares  of  domestic  corporations,  valued  in  the  manner 
hereinafter  described,  and  those  of  foreign  corporations  pay  the 
same  rate  of  State  tax;  but  domestic  corporations  pay  the  local 
late  or  rates  of  the  respective  communities  in  which  the  share- 
holders reside,  while  the  shares  of  foreign  corporations  (if  divi- 
dend-paying) are  taxed  throughout  the  State  at  the  fixed  and 
uniform  rate  of  30  cents  on  the  $100  valuation  for  local  purposes 
plus  the  general  property  rate  for  State  purposes.  Certificates 
of  indebtedness  and  bonds  of  domestic  and  foreign  corporations 
are  taxed  in  the  same  manner  at  the  residence  of  the  holder. 


*See  post:  "Taxation  of  Shares  of  Stocks  of  Banks;  Other  Financial 
Corporations." 
1  Chapter  178. 


266  Report  of  the  Commission 

THE  DEVELOPMENT  OF  THE  LAW  FOR  THE  TAXA- 
TION OF  CORPORATIONS. 

The  first  act  requiring  corporations  to  pay  the  tax  on  shares 
was  passed  in  1841,-  when  the  State  tax  was  imposed  on  shares 
held  by  nonresidents  of  the  State,  collectible  through  the  cor- 
poration; a  year  later,  the  principle  of  collection  at  the  source 
was  extended  so  as  to  apply  to  all  stockholders.-^  These  acts 
required  the  corporations  to  withhold  the  State  tax  from  the 
dividend.    They  did  not  apply  to  the  local  taxes. 

None  of  these  acts  provided  any  method  of  valuation  and  such 
values  continued  to  be  determined  by  local  assessors.  Under  an 
act  of  1847,'*  the  County  Commissioners  of  the  counties,  or  the 
levy  courts,  or  in  Baltimore  city  the  Appeal  Tax  Court,  placed  a 
valuation  upon  the  shares  held  within  their  respective  jurisdic- 
tions, with  deduction  allowed  for  the  assessed  valuation  of  real 
and  personal  property.  This  valuation  determined  the  assess- 
ment of  shares  for  State,  local  and  municipal  purposes.  Local 
taxes  were  collected  directly  from  the  shareholders,  unless  the 
corporation  paid  the  county  and  municipal  taxes,  which  it  had  the 
right  to  do. 

There  was  no  material  change  in  the  law  until  1872,''^  when 
the  practice  of  annual  assessment  of  the  shares  of  domestic  cor- 
porations was  introduced.  In  1874,^  an  act  was  passed  which  re- 
quired payment  of  county  and  municipal  taxes  by  nonresident 
shareholders  and  required  the  corporations  to  deduct  the  amount 
of  such  taxes  from  the  dividends. 

In  1878"  there  were  many  changes  in  the  law,  the  chief  of 
which  was  the  creation  of  the  office  of  State  Tax  Commissioner, 
which  was  required  to  value  shares  of  banks  and  domestic  cor- 
porations for  all  State  and  local  taxation.  About  this  timc^  the 
Court  of  Appeals  decided  that  it  was  prohibited  double  taxation 
to  tax  both  the  shares  of  the  corporation  and  the  real  and  per- 
sonal property  belonging  to  the  corporation.  To  meet  this  deci- 
sion the  Act  of  1880,  Chapter  20,  was  passed. 

2  Chapter  23,  Section  17. 

3  Acts  of  1841,  ch.  281.    Acts  of  1843,  ch.  289. 

4  Chapter  266,  Section  5. 

5  Chapter  127. 

6  Chapter  483. 

7  Chapter  178. 

8  Frederick  County  vs.  Farmers  and  Mechanics  National  Bank,  48 
Md.  188. 


Taxation  of  Corporations  267 

PRESENT   METHOD   OF  ASSESSING   SHARES   OF 

STOCK. 

Corporations  (domestic)  subject  to  the  tax  on  shares  are  re- 
quired to  report^  annually  to  the  State  Tax  Commissioner  and 
furnish  him  with  all  such  information  concerning  the  affairs 
of  the  corporation  as  may  be  required.  Section  153  of  Article  81 
of  the  Code  requires  the  corporation  to  report  to  the  State  Tax 
Commissioner  the  number  of  shares  outstanding,  the  par  value 
per  share,  "and  such  information  in  regard  to  the  value  of  the 
same  as  may  be  required  by  the  said  Commissioner. '"  The  num- 
ber of  shares  held  in  each  county  or  city  is  reported^^  by  the 
corporation  to  the  county  or  city  in  which  such  shareholders 
reside. 

Corporations  pay  directly  to  the  State  Comptroller  the  State 
tax  levied  upon  the  net  assessment  of  all  outstanding  shares,  in- 
cluding those  of  non-resident  holders,  and  the  corporations  pay- 
to  the  several  counties^i  and  incorporated  cities  the  respective 
local  taxes  due  on  the  shares  held  by  residents  of  these  commu- 
nities. The  Code  of  Public  General  Laws  has  provisions  for  de- 
termining to  what  localities  the  local  tax  on  shares  held  by  non- 
residents shall  be  paid.^- 

From  the  aggregate  valuation  of  the  shares,  as  determined  by 
the  Commissioner,  is  deducted  the  assessed  valuation  of  the  real 
estate  (the  State  and  local  taxes  on  which  are  directly  paid  to 
the  local  collector  of  State  and  local  taxes)  as  appears  from 
the  certificates  of  the  same  furnished  by  the  County  Commis- 
sioners of  the  counties  and  Appeal  Tax  Court  of  Baltimore  city. 

The  law  expressly  provides  that  "in  no  case  shall  the  stock  of 
any  corporation,  in  the  aggregate,  be  valued  at  less  than  the  full 
value  of  the  real  estate  and  chattels,  real  and  personal,  held  by 
or  belonging  to  such  corporation  in  the  several  counties  and  city 
of  Baltimore,  whether  the  shares  of  said   stock  are  quoted  on 


»  Article  81,  Section  LSI. 

10  Article  81,  Section  159. 

11  The  Act  of  1900,  giving  Allegany  County  all  the  local  taxes  on  all  stock 
of  its  corporations,  no  matter  where  owned,  is  invalid,  because  it  violates 
Article  3,  Section  51,  of  the  Constitution.  Mayor  and  City  Council  o£ 
Baltimore  vs.  County  Commissioners  of  Allegany  County,  99  Md.  1. 

12  Article  81,  Section  150. 


268  Report  of  the  Commission 

the  market  or  not.''^'^  This  rule  of  minimum  valuation,  man- 
datory in  form,  is  intended  to  insure  a  gross  valuation  of  the 
shares  not  less  than  the  value  of  the  real  estate  plus  the  tangible 
personal  property  of  the  company  located  in  Maryland,  the  clear 
purpose  of  which  was  to  make  certain  that  the  net  assessed  value 
of  the  shares  (after  deduction  of  credits)  should  fully  reflect  the 
value  of  the  tangible  personal  property,  thus  preventing,  as  far 
as  possible  under  any  system  of  share  taxation,  any  discrimina- 
tion in  favor  of  corporations  as  against  firms  or  individuals  own- 
ing similar  property. 

From  this  aggregate  is  also  deductible,  for  State  purposes, ^^^ 
any  investments  in  stock  of  the  State  of  Maryland,  from  the  in- 
terest on  which  the  State  tax  is  deductible.  Section  163,  Article  81, 
of  the  Code  also  provides  for  the  deduction  for  local  purposes  of 
certain  issues  of  Baltimore  city  stock,  such  deduction  being,  how- 
ever, limited  to  the  corporate  shares  which  are  taxable  in  Balti- 
more city  and  on  which  a  proportionate  credit  of  such  city  stock 
investments  is  given  by  the  City  Collector  of  Baltimore.  Balti- 
more city  stock  upon  which  the  State  tax  has  been  paid  or  is 
payable  by  the  city  of  Baltimore  (under  Sections  107  to  110, 
Article  81,  of  the  Code)  is  deductible  for  State  purposes  from 
all  the  shares  of  the  corporation  wherever  held. 

Section  163  also  allows  a  deduction,  for  State  and  local  pur- 
poses, of  the  net  assessed  value  of  any  shares  of  other  banks 
or  domestic  corporations  held  by  the  corporation  "as  an  invest- 
ment of  any  part  of  its  capital  or  surplus." 

Domestic  corporations  "actually  engaged  in  the  business  of 
manufacturing"  are  allowed  a  credit  (for  local  purposes  only) 
of  the  value  of  their  tools,  machinery,  manufacturing  implements 
or  engines.  1^  This  credit  is  confined  to  shares  taxable  in  the 
cities,  towns  or  counties   which  have  local  laws  exempting  the 


1^  See  American  Coal  Company  vs.  Allegany  County,  59  Md.  185 ;  Mayor 
and  City  Council  of  Baltimore  vs.  Canton  Company,  63  Md.  218 ;  Skinner 
Drydock  Company  vs.  Mayor  and  City  Council  of  Baltimore,  96  Md.  42. 
The  fact  that  the  capital  is  invested  principally  in  patent  rights  does  not 
exempt  the  shares  of  stock  from  taxation  or  permit  the  value  of  the  patents 
to  be  deducted  from  the  value  of  the  shares.  Crown  Cork  and  Seal  Com- 
pany vs.  State,  87  Md.  687. 

i-i  Schley  vs.  Lee,  106  Md.  394.  As  a  matter  of  fact,  there  has  not  for 
many  years  been  issued  any  State  stock  from  the  interest  on  which  the 
State  tax  is  deductible. 

15  Anne  Arundel  County  vs.  Sugar  Refining  Company,  99  Md.  486. 


Taxation  of  Corporations  269 

machinery  of  manufacturers ;  and,  as  in  the  case  of  the  credit  of 
Baltimore  city  stock,  the  deduction  is  only  of  such  proportionate 
part  of  the  shares  as  the  assessed  value  of  the  shares  taxable  in 
such  district  or  districts  bears  to  the  assessed  value  of  the  entire 
issue  of   shares. 

The  purpose  of  this  provision  was  to  give  to  ^Maryland  manu- 
facturing corporations  the  benefit  of  local  plant  exemption  laws 
or  ordinances,  since  the  mere  exemption  of  the  machinery,  with- 
out an  express  provision  for  the  deduction  of  its  value  from  the 
shares  of  the  corporation,  would  give  no  advantage  to  such  cor- 
poration. This  results  from  the  fact  that  all  the  personal  prop- 
erty of  Maryland  share  corporations  (except  railroads )  is  already 
exempt  from  the  direct  taxation  under  Section  4  oi  Article  1  of 
the  Code. 

THE  ASSESSMENT  OF  TANGIBLE  PROPERTY  OF 

CORPORATIONS. 

Real  Estate. 

The  real  estate  of  corporations  is  assessed  locally,  exactly  as 
the  real  estate  of  individuals,  by  local  assessors,  and  is  included  in 
the  aggregate  of  assessed  valuation  for  that  community,i'^  and 
the  tax  is  paid  in  the  same  manner  as  the  tax  on  property  of  an 
individual.  This  statement,  however,  is  subject  to  one  qualifi- 
cation. 

Cities  (^except  Baltimore  city)  and  towns  in  the  State  form 
parts  of  a  county,  which  is  the  assessment  unit.  The  assesment 
of  the  property  within  limits  of  such  cities  and  towns  is  in  many 
cases  separately  and  differently  assessed  for  county  or  State 
purposes  from  what  it  is  for  municipal  purposes. 

This  subject  of  the  difl'erent  manner  of  assessment  of  the  same 
property  is  discussed  elsewhere, i'^  but  as  regards  the  real  estate 
of  corporations  there  is  a  limitation  on  the  power  of  municipal 
assessors  to  assess  the  real  estate  of  corporations  for  municipal 
purposes. 


16  The  real  estate  of  a  corporation  located  in  another  State  is  not 
properly  deductible.  American  Coal  Company  vs.  Allegany  County,  59 
Md.  185. 

1"  See  ante :  "Assessment  in  Maryland." 


270  Report  of  the  Commission 

As  far  as  known,  the  question  first  arose  in  court  in  the  city 
of  Cumberland.  Individual  properties  there  are  assessed  at  one 
valuation  for  county  and  State  purposes  and  at  another  valua- 
tion for  local  municipal  purposes.  When  the  local  assessors 
attempted  to  equalize  the  assessment  of  the  real  estate  of  corpo- 
rations with  that  of  adjoining  property  objection  was  raised  by 
the  corporations  and  the  question  reached  the  court.^^  The 
lower  court  decided  that  the  county  and  State  assessment  must 
be  also  the  assessment  for  local  purposes,  because  of  the  peculiar 
provisions  of  the  code  under  which  credits  or  deductions  for  real 
estate  are  allowed  on  the  basis  of  the  assessment  for  State  and 
county  purposes. 

The  vice  of  the  condition  lies  in  the  fact  that  similar  adjoining 
properties  may  thus  have  different  valuations  for  municipal  pur- 
poses; and  as  long  as  this  dual  basis  exists  injustice  as  between 
adjoining  property  holders,  in  the  payment  of  municipal  taxes, 
will  continue.  The  system  is  also  unfair  to  the  municipal  corpo- 
ration. The  ruling  allows  a  corporation  owning  real  estate  in  a 
block  to  have  an  assessment  of,  say,  $150  a  front  foot,  while 
the  adjoining  property  of  exactly  the  same  value,  owned  by  an 
individual  or  firm  or  railroad  company  or  foreign  corporation, 
may  have  to  pay  at  a  $300-a-foot  valuation. 

The  same  condition  was  exposed  in  the  municipal  re-assessment 
in  Frederick  in  1909,  and  exists  in  a  number  of  other  cities  and 
towns  where  this  vicious  dual  system  obtains. 

As  Baltimore  city  has  the  legal  status  of  a  county,  the  State 
assessments  are  the  same  as  the  city  assessments. 

Personal  Property. 

As  regards  the  assessment  of  personal  property  of  corpora- 
tions there  is  a  greater  contrast  and  injustice.  Personal  property 
of  individuals  is  assessed  locally,  while  the  personal  property  of 
domestic  corporations,  though  not  directly  assessable,  is  valued 
by  the  officers  of  the  corporations  and  reported  by  them  to  tho 
State  Tax  Commissioner.     The  law  contemplates  that  the   full 


18  First  National  Bank  vs.  Mayor  and  City  Council  of  Cumberland,  Cir- 
cuit Court  for  Allegany  County,  December,  1906.  Opinion  by  Boyd,  C.  J. 
(The  case  was  appealed  to  the  Court  of  Appeals  of  Maryland,  but  was 
abandoned.) 


Taxation  OF  Corporations  271 

value  of  the  tangible  personal  property  in  the  State  (as  well  as 
the  real  estate)  should  be  reflected  in  the  gross  valuation  of  the 
shares.  Investigation,  however,  shows  that  there  are  many  cor- 
porations which  own  valuable  personal  property  paying  little  or 
no  indirect  tax  on  this  class  of  property. 

There  have  been  no  facilities  for  the  commission  to  have  a 
careful  analysis  made  of  these  valuations  of  personal  property 
by  corporations  or  of  the  resultant  assessments  on  their  shares, 
but  numerous  instances  have  been  brought  to  notice  which  show 
that  the  net  assessed  valuations  of  the  shares  reflect  either  no 
valuation  at  all  or  else  an  inadequate  valuation  of  the  personal 
property. 

OBJECTIONS  TO  THE  METHOD  OF  TAXING  SHARES 

INSTEAD  OF  TAXATION  OF  TANGIBLE  ASSETS 

OF  CORPORATIONS. 

There  is  serious  objection  to  the  present  method  of  taxing 
corporations,  especially  so-called  business  corporations,  both  from 
the  standpoint  of  the  law  and  of  the  administration,  which  may 
be  epitomized  as  follows : 

Maryland  business  corporations  are  discriminated  against  as 
compared  with  like  corporations  in  other  States. 

Corporate  excess  is  uncertain  and  many  intangible  elements 
determine  the  value  of  shares,  and  these  elements  cannot  be 
properly  assessed  by  any  method;  and  when  these  elements  are 
taxed  (indirectly)  there  is  an  unfair  discrimination  in  favor  of 
firms  and  individuals  in  the  same  line  of  business  as  against 
whom  these  elements  are  not  taxed. 

Personal  property  should  not  be  valued  by  officials  of  corpora- 
tions who  themselves  pay  the  tax.  Officers  of  corporations  are 
human,  and  the  frailty  of  nature  means  that  some  officers  are 
conscientious  while  others  are  not. 

It  is  a  virtually  impossible  task  for  the  State  Tax  Commissioner 
sitting  in  Annapolis  to  value  equitably  personal  property  in  all 
parts  of  the  State. 

Some  corporations  may  be  unknown  to  the  State  Tax  Com- 
missioner, especially  because  prior  to  1908  charters  were  filed  in 
the  clerk's  offices  of  the  local  courts  and  there  were  no  records 


272  Report  of  the  Commission 

in  any  central  State  office ;  reports  show  that  there  are  but  3,497 
domestic  corporations  reporting. 

CompHance  with  the  law  means  that  officers  should  annually 
submit  statements  disclosing  the  secrets  of  business.  The  method 
is  extremely  inquisitorial. 

The  Constitution  (Article  3,  Section  51)  contemplates  that 
"goods  and  chattels  permanently  located  shall  be  taxed  in  the  city 
or  county  where  they  are  located,"  and  the  law  recognizes  the 
justice  of  this  doctrine  in  taxing  the  real  estate  of  all  corpora- 
tions where  it  is  situated,  though,  curiously  enough,  real  estate 
is  not,  under  the  Constitution,  required  to  be  so  treated. 

The  protection  and  care  of  personal  property  from  fire  and  by 
the  police  are  properly  local  charges. 

The  compulsory  disclosure  of  the  internal  and  private  aiTairs 
of  companies,  and  the  annoyance  and  red  tape  of  annual  reports 
have  operated  materially  to  the  disadvantage  of  cities  and 
counties. 

The  taxation  of  the  shares  of  such  corporations  (at  the  resi- 
dences of  the  shareholders)  rather  than  the  direct  taxation  of 
the  assets  where  located,  operates  as  an  embargo  on  the  invest- 
ment of  capital  where  a  higher  local  rate  prevails  at  the  resi- 
dences of  the  shareholders  than  at  the  situs  of  the  property.  There 
is,  for  example,  little  inducement  under  the  present  system  for 
the  investment  of  Baltimore  capital  in  county  enterprises. 

The  principle  of  asset  taxation*  as  applied  to  business  corpora- 
tions has  been  recommended  by  commissions  which  have  de- 
voted their  entire  attention  to  the  study  of  corporations,  and  this 
method  is  sound  in  theory  and  far  easier  to  administer  with 
justice  to  corporate  interests  and  others  contributing  to  taxation 
than  is  the  present  cumbersome  and  unscientific  method. 


*"lhe  State  may  elect  to  tax  either  the  capital  stock  or  the  real  and  per- 
sonal property  of  tlie  company."     State  vs.  Penn.  R.  R.  Co.,  40  Md.  22. 


Taxation  of  Corporations 


273 


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274  Report  of  the  Commission 

MANUFACTURING  COMPANIES.ia 

What  has  been  said  concerning  the  taxation  of  domestic  cor- 
porations applies  to  the  taxation  of  manufacturing  corporations, 
and,  if  anything,  the  effect  of  corporate  excess  taxation  is  felt 
more  keenly  by  this  than  by  any  other  class. 

The  relationship  between  manufacturing  industries  and  wealth 
is  close  and  important ;  indeed  so  close  and  important  that  the 
Bureau  of  Census  states  "the  increase  of  manufacturing  capital 
may  be  taken  as  an  index  of  the  changing  value  of  real  property 
and  of  the  aggregates  of  private  wealth." 

Unfavorable  tax  laws,  such  as  are  in  force  in  Maryland  today, 
not  only  keep  manufacturers  out  of  the  State  but  tend  to  de- 
prive manufacturers  already  located  here  of  the  ability  to  com- 
pete on  equal  terms  with  similar  manufacturers  in  neighboring 
States.  This  unfortunate  condition  has  prevailed  for  many 
years  in  sharp  contrast  with  the  policy  of  sister  States,  which 
have  taxed  manufacturing  industries  most  leniently. 

One  of  the  chief  criticisms  of  Maryland's  tax  policy  regarding 
manufacturers  is  that  it  does  not  pay,  even  as  to  the  amount  of 
taxes  collected.  The  case  in  point  is  a  good  example  of  the 
fact  that  a  high  tax  rate  often  results  in  a  low  return.  Manu- 
factures are  not  anchored  to  the  State.  A  few,  taxed  at  a  high 
rate,  will  not  yield  the  same  sum  as  will  be  produced  by  a  com- 
paratively low  tax  on  a  large  number  of  manufacturing  plants. 
Increases  in  property  values,  due  to  the  location  of  new  indus- 
tries, are  of  even  more  importance  than  the  direct  tax  on  the 
industries  themselves. 

Present  conditions  should  not  be  allowed  to  continue  anv 
longer.  These  conditions  have  forced  numerous  manufacturing 
industries  not  only  to  incorporate  but  also  to  locate  their  plants 
outside  of  jMaryland.  It  is  of  basic  importance  that  the  tax 
laws  of  Maryland  should  be  changed  so  as  to  aft'ord  manufac- 
turing industries  privileges  equal  to  those  offered  in  competing 
States. 


1^  See  "The  Vital  Nef  d  of  Legislation  on  the  Taxation  Question"    (of 
manufacturers) — H.  Findlay  French.  Esq..  Baltimore,  January,   1912. 


Taxation  of  Corporations 


275 


The    following   tabulation    shows    some    of    the    disadvantages 
under  which  the  Maryland  manufacturer  suffers: 


CAPITAL  STOCK  TAX. 

PERSONAL. 

REAL. 

New  York — Local  only. 
New  Jersey — None. 
Pennsylvania — State  only. 
Delaware — Mio  of  1  per  cent. 
Maryland — ZVs  per  cent.* 

Largely  not  reached. 
Net  only. 
Tangible  :  none. 
Largely  exempt. 
Exempt   when   capital 
stock  tax  paid. 

Varies  only  in 
regard   to 
amount  of 
true  value 
assessed. 

BONUS,  OR  ORGANIZATION,  TAX  FOR  DOMESTIC 

CORPORATIONS. 

In  1890  the  Legislature  provided  that  all  incorporations  under 
the  laws  of  Maryland,  either  by  general  or  special  law,  except 
railroad  companies,  cemetery,  benevolent,  charitable  and  like 
associations,  should  be  subject  to  a  State  fee  of  %  of  1  per  cent, 
of  the  amount  of  authorized  capital  stock.  A  fee  was  also  pro- 
vided for  subsequent  increases  in  the  amount  of  capital  stock. 
The  law  has  been  amended  in  minor  particulars,  but  the  rate  for 
both  incorporations  and  increases  is  Vs  of  1  per  cent,  of  author- 
ized capital  stock  at  the  present  time.  The  receipts  from  this 
source  in  1912  were  $26,b54.84. 


FOREIGN  CORPORATIONS. 

The  law  provides  that  foreign  corporations,  except  those  which 
are  required  to  pay  gross  receipts  taxes,  shall  pay  as  a  franchise 
tax  to  the  State  annually  for  the  use  of  the  State  $25  for  every 
full  $50,000  of  capital  employed  in  the  State  up  to  $500,- 
000,  but  in  no  case  less  than  $25 ;  if  the  amount  of  such  capital 
is  more  than  $500,000  and  not  more  than  $5,000,000,  then  an 
additional  amount  equal  to  1-40  of  1  per  cent,  on  the  excess; 
and  if  more  than  $5,000,000,  then  an  additional  amount  at  the 
rate  of  $30  for  every  $1,000,000  of  such  last-named  excess. -^ 


20  Article  23.  Section  95. 
*Local  rates  vary. 


276  Report  of  the  Commission 

By  the  above  ])rovisions  a  foreign  corporation  employing  $10,- 
000  or  even  less  in  the  State,  pays  an  annual  tax  of  $25.  A  cor- 
poration employing  $99,000  would  pay  the  same  amount.  The 
probable  intent  of  the  Legislature  was  to  impose  an  additional 
amount  of  tax  upon  sums  employed  between  $50,000  and  $100,- 
000,  but  due  to  the  omission  of  any  specific  provision  upon  that 
subject  the  increase  in  the  tax  does  not  come  into  operation  until 
the  employed  capital  reaches  the  sum  of  $100,000.  This  point 
has  been  the  subject  of  considerable  criticism. 

In  the  annual  report  of  the  Comptroller  of  the  State  for  the 
year  1911  attention  was  directed  to  the  taxation  of  foreign  cor- 
porations and  the  present  law  was  criticised. 

The  Comptroller  says  :-^ 

"(By  the  provisions  of  law  foreign)  *  *  *  companies  are 
required  to  pay  the  tax  to  the  State  Treasurer  before  the  first 
day  of  April  in  every  year,  and  if  not  paid  by  the  first  day  of 
November  following,  it  becomes  obligatory  upon  the  Comptroller, 
under  Section  71,  to  place  said  bills  in  the  hands  of  the  Attorney- 
General  for  collection  by  suit,  but  the  statute  nowhere  provides 
for  any  mode  by  which  the  Comptroller  is  advised  of  the  amount 
of  capital  employed  by  such  companies  within  the  State,  and 
only  through  the  courtesy  of  the  Secretary  of  State  in  transmit- 
ting such  information  to  this  office  has  the  Comptroller  been 
enabled  to  enforce  the  collection  of  this  tax.  In  my  judgment 
this  statute  should  be  so  amended  that  at  the  time  of  the  filing  of 
their  certificates  with  the  Secretary  of  State  they  should  be  re- 
quired to  also  file  a  like  certificate  with  the  Comptroller,  setting 
forth  the  amount  of  capital  employed  within  the  State,  in  order 
that  the  Comptroller  should  have  in  his  own  office  proper  returns 
upon  which  to  base  the  tax.  Further,  I  deem  it  important  that 
additional  powers  be  granted  to  him  whereby  he  may  able  to  call 
for  and  enforce  supplemental  reports,  if  necessary,  in  order  that 
the  actual  amount  of  capital  so  employed  be  ascertained.  As  the 
statute  now  stands,  the  Comptroller  is  required  to  collect  this 
tax  without  any  provision  whatever  being  made  for  any  returns 
to  his  office  upon  which  this  tax  is  to  be  based,  and  as  a  matter 
of  fact  it  is  possible  for  the  largest  foreign  corporations  doing 
business  in  this  State,  with  visible  property  of  hundreds  of  thou- 


21  Report  of  Comptroller,   1911,  pp.   14  and   15. 


Taxation  of  Corporations  277 

sands  of  dollars,  to  make  a  return  of  only  $5,000  of  capital  em- 
ployed and  therefore  pay  a  tax  of  only  $25,  while  several  large 
foreign  corporations  employed  in  Maryland  return  no  capital 
at  all. 

"Again,  the  statute  further  provides  that  this  tax  of  $25  shall 
be  levied  upon  every  full  $50,000  of  capital  employed  by  it  in 
this  State.'  Therefore  if  the  capital  employed  be  $99,999,  the  tax 
is  only  $25,  or  no  more  than  if  the  capital  employed  were  $50,000. 
In  my  judgment,  this  provision  should  be  so  amended  as  to 
read  'at  the  rate  of  $25  for  every  $50,000  of  capital  employed,' 
thereby  subjecting  the  actual  amount  of  capital  employed  to 
the  operations  of  this  tax.  Domestic  corporations  are  required 
to  pay  taxes  upon  actual  values,  therefore  why  should  there 
be  any  discrimination  against  them  in  favor  of  foreign  corpora- 
tions?" 

The  following  table  has  been  compiled  from  a  report  to  the 
Commission  by  the  Secretary  of  State  of  Maryland,  and  shows 
the  total  number  of  foreign  corporations  classified  according  to 
the  capital  employed,  which  have  complied  with  the  law : 


278 


Report  of  the  Commission 


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Taxation  of  Corporations  279 

The  stock  of  foreign  corporations  is  taxed  for  State  purposes 
at  the  same  rate  as  the  stock  of  domestic  corporations,  but  is 
taxed  wherever  held  in  the  State  for  local  purposes  at  the  uni- 
form rate  of  30  cents  on  the  $100. 

There  is  no  return  of  the  business  of  foreign  corporations  to 
any  State  officer  in  Maryland,  and  consequently  their  affairs  are 
not  subject  to  the  same  inquisitorial  and  searching  examination 
that  domestic  corporations  are  subject  to.  They  pay  an  annual 
franchise  tax  to  those  States  in  which  chartered. 

The  present  law  discriminates  in  favor  of  foreign  corporations 
against  domestic  corporations. 

Foreign  corporations  pay  also  the  tax  on  real  estate  and  per- 
sonal property  for  State  and  local  purposes  "as  if  the  same  be- 
longed to  a  natural  person."--.  Foreign  steam  railroad  com- 
panies, subject  to  the  gross  receipts  tax,  are  exempt  from  State 
taxation  on  real  and  personal  property.-^  The  Baltimore  and 
Ohio  Railroad  Company,  except  the  Washington  branch,  is  ex- 
empt also  from  local  taxation. 

ENTRANCE  FEE,  FOREIGN  CORPORATIONS. 

The  Legislature  of  1898  imposed  an  entrance  fee  upon  all 
foreign  corporations,  except  telephone,  banking,  insurance  and 
railroad  companies,  electric  light  or  construction  companies  and 
oil  or  pipe-line  companies,  of  $25  for  the  privilege  of  doing  busi- 
ness in  the  State.  This  fee  is  paid  to  the  Secretary  of  State,  and 
is  still  in  force.  The  receipts  from  this  source  in  1912  were 
$1,437.21. 

GROSS  RECEIPTS  TAXES. 

The  gross  receipts  tax  of  1872  was  the  first  passed  in  Mary- 
land. It  applied  to  railroads  only  and  remained  in  force  until 
the  passage  of  the  general  gross  receipts  act  of  1894.  This  law, 
although  having  undergone  frequent  changes,  is  still  in  effect. 
It  is  a  source  of  considerable  revenue  to-  the  State  and  now  em- 
braces all  classes  of  public  service  corporations,  except  electric 


22  Article  23,  Section  97. 

23  Article  81,  Section  159. 


280  Report  of  the  Commission 

railway  companies  and  freight  car  companies.  Another  excep- 
tion is  the  Baltimore  and  Ohio  Railroad,  which  pays  a  special 
tax  instead. 

Railroad  Companies. 

Foreign  and  domestic  steam  railroad  companies  pay  a  grad- 
uated tax  based  on  domestic  gross  receipts  per  mile,  as  follows : 
For  the  first  $1,000  or  less,  I14  per  cent. ;  from  $1,000  to  $2,000, 
2  per  cent.,  and  2i/^  per  cent,  upon  gross  receipts  per  mile  above 
$2,000.24 

Railroads  whose  lines  are  located  partly  within  and  partly 
without  the  State  are  taxed  on  such  portion  of  the  entire  gross 
receipts  as  the  length  of  their  lines  in  the  State  bears  to  the  total 
length  of  their  lines  wherever  located. ^^ 

The  Baltimore  and  Ohio  Railroad  Company  has  a  special  con- 
tract with  the  State  whereby  it  escapes  the  regular  gross  receipts 
tax  and  pays  instead  a  tax  of  1/2  of  1  per  cent,  upon  gross  earn- 
ings in  Maryland.-*^ 

Steam  railroads  are  specially  exempt  from  further  taxation  for 
State  purposes,  but  with  the  exception  of  the  Baltimore  and 
Ohio  are  taxed  locally  for  local  purposes  on  real  and  personal 
property  in  practically  the  same  manner  as  individuals.-" 

An  act^s  of  1908  provides  that  a  railroad  changing  its  motive 
power  in  whole  or  in  part  from  steam  to  electricity  shall  con- 
tinue to  be  subject  to  all  the  provisions  of  the  laws  of  this 
State  relating  to  the  taxation  of  railroad  companies  whose  roads 
are  worked  by  steam  power.     Under  the  present  laws  it  is  pos- 

2^  Acts  1906,  Chapter  712.  "Gross  receipts  or  gross  earnings"  as  used 
in  this  statute  do  not  include  "any  income  derived  from  the  investment 
of  the  capital  or  surplus  of  any  of  the  corporations  mentioned  in  said 
section,  and  in  the  case  of  the  use  of  moneys  received  or  deposited,  they 
shall  include  only  the  difference  between  the  receipts,  earnings  or  revenues 
derived  from  the  use  of  such  deposited  moneys,  and  the  interest  paid  on 
such  deposits."     Article  81,  Section  166. 

25  Article  81,  Section  164. 

26  Acts  1878,  Chapter  155. 

2"  A  railroad  company  holding  property  in  the  city  of  Bahimore  under 
a  99-year  lease  from  the  city  is  liable  under  the  terms  of  the  lease  to  pay 
all  taxes,  assessments,  etc.,  but  should  be  assessed  only  on  the  value  of 
the  leasehold  estate.  Such  property  is  taxed  in  the  same  manner  as  property 
similarly  held  by  individuals.  Appeal  Tax  Court  vs.  Western  Maryland 
Railroad  Company;  Same  vs.  Union  Railroad  Company,  50  Md.  274  (1878)  ; 
P.,  W.  &  B.  R.  R.  Co.  vs.  Appeal  Tax  Court,  50  Md.  397  (1879). 

28  Chapter  154. 


Taxation  of  Corporations  281 

sible  for  three  similar  electric  railroad  lines  to  be  taxed  under 
three  distinctly  different  systems.  First,  a  domestic  company 
originally  of  the  electric  type,  would  pay  the  capital  stock  tax 
and  the  general  property  tax  on  real  property  for  State  and  local 
purposes  by  the  same  rule  as  domestic  corporations  in  general. 
Second,  a  foreign  company  would  pay  the  general  property  tax 
on  real  and  personal  property  for  State  and  local  purposes,  "as  if 
the  same  belonged  to  a  natural  person."  Thirdj  a  domestic  or 
foreign  railroad,  which  was  originally  a  steam  railroad  but  which 
had  been  converted  into  an  electric  railroad,  would  pay  the  gross 
receipts  tax  for  State  purposes  and  the  general  property  tax  for 
local  purposes,  the  rolling  stock  being  treated  like  the  rolling 
stock  of  steam  railroads. 

Other  Transportation  Companies,  Transmission  and 
Electric  Light  Companies. 

The  following  corporations,  domestic  and  foreign,  pay  a  tax 
on  gross  receipts  within  the  State  measured  in  the  same  manner 
as  that  employed  in  the  case  of  railroads : 

Telegraph  or  cable,  express  or  transportation  (except  railroads, 
steam  or  electric),  and  sleeping-car  companies,  pay  to  the  State 
for  State  purposes  a  tax  of  ZV^  per  cent. ;  telephone  and  oil  pipe- 
line companies,  2  per  cent. ;  electric  light  companies,  1  per  cent. ; 
electric  construction  and  gas  companies,  1%  per  cent.  Domestic 
corporations  are  in  addition  taxed  on  capital  stock. 

Freight  Car  Companies. 

The  property  of  freight  car  companies  consists  almost  entirely 
of  cars  and  the  right  to  run  them  over  certain  railroads.  Under 
the  present  law  such  cars  are  assessable  in  Maryland  to  the  rail- 
roads over  which  they  are  operated,  but  it  is  quite  probable  that 
little,  if  any,  of  the  property  of  these  companies  is  now  listed  for 
taxation  in  this  State. 

As  a  rule  freight  car  companies  are  most  successfully  taxed  in 
other  States  by  the  gross  receipts  method,  and  while  the  revenue 
from  a  State  gross  receipts  tax  in  Maryland  on  freight  car  com- 


282  Report  of  the  Commission 

panics,  at  a  reasonable  rate,  would  not  aggregate  a  large  sum, 
such  a  tax  would,  if  properly  administered,  produce  sufficient 
State  revenue  to  be  worthy  of  consideration. 

Foreign  Fertilizer  Companies. 

Foreign  guano,  phosphate  and  fertilizer  manufacturing  corpo- 
rations are  taxed  for  State  purposes  U/o  per  cent,  on  gross  re- 
ceipts, while  domestic  corporations  and  individuals,  or  partner- 
ship concerns  engaged  in  the  same  industry,  are  not  subjected  to 
the  tax.  In  fact,  this  class  of  corporations  constitutes  the  only 
instance  in  which  any  industry  is  taxed  in  Maryland  on  gross 
receipts,  and  there  is  no  good  reason  why  this  class  should  be 
singled  out  for  the  application  of  a  special  tax. 

Revenue  From  Gross  Receipts  Taxes. 

The  revenue  from  the  gross  receipts  taxes  constitutes  the 
principal  item  of  State  receipts  from  corporate  taxation,  and 
since  the  enactment  of  the  present  law  has  brought  to  the  State 
a  substantial  income. 


Taxation  of  Corporations 


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Taxation  of  Stock  of  Banks,  Etc.  285 


TAXATION  OF  SHARES  OF  STOCK  OF  BANKS : 
OTHER  FINANCIAL  CORPORATIONS. 

Nearly  all  the  statements  made  concerning  the  method  of  as- 
sessing shares  of  stock  of  Maryland  corporations  apply  to  assess- 
ment of  shares  of  banks,  and  all  the  criticisms  made  against  the 
further  continuance  of  those  methods  apply  with  equal  force  to 
corporations  of  this  kind. 

In  regard  to  banks,  the  assets  can  more  readily  be  discovered 
and  appraised,  and  yet  it  would  seem  that  the  general  administra- 
tion! of  the  law  in  assessment  of  bank  shares  has  been  no  better 
or  worse  than  the  assessment  of  other  corporations.  Prior  to 
1907  the  State  Tax  Commissioner  arbitrarily  deducted  one-quar- 
ter of  the  value  of  the  total  assets  of  financial  institutions  before 
assessing  the  shares;  but  the  Court  of  Appeals  of  Maryland,  in 
Schley  vs.  :Montgomery  County,^  held  this  deduction  to  be  un- 
constitutional, and  since  then  the  entire  assets  are  supposed  to  be 
assessed. 

Banks  are  more  than  State-wide  in  their  activity  and  reach 
out  through  the  entire  territory  in  which  the  merchants  of  the 
same  community  do  business. 

Under  the  present  system  of  banking,  there  are  three  central 
reserve  cities  in  the  country — viz.  New  York,  Chicago  and  St. 
Louis — and  a  number  of  other  or  secondary^  reserve  cities.  Bal- 
timore is  one  of  these. 


1 106  Md.  407. 


286 


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Taxation  of  Stock  of  Banks,  Etc.  287 

The  reserve  cities  seek  banking  connections  in  all  parts  of  the 
country,  and  are  desirous  of  obtaining  the  deposits,  loans  and 
clearances  of  banks  in  smaller  communities.  Under  our  compli- 
cated system  of  State  government,  it  is  not  surprising  that  some 
communities  can  offer  greater  inducements  than  others;  as  far 
as  consistent  with  conditions  within  the  State,  Maryland  should 
not  cause  its  banks  to  be  handicapped.  It  is  certainly  true  that 
the  additional  cost  to  local  banks,  due  to  higher  tax  rates  as  com- 
pared with  other  cities,  makes  it  necessary  for  financial  institu- 
tions to  charge  a  higher  rate  of  interest,  and  that  this  additional 
burden  falls  upon  business  houses  and  more  especially  upon  the 
smaller  houses,  which  cannot  form  banking  connections  with  New 
York  or  Philadelphia. 

THE  BANKING  CONDITION  IN  MARYLAND. 

Ten  years  ago  the  total  capital  in  Maryland  of  national  banks 
was  $17,050,000;  in  1912  it  was  $17,607,000.  This  was  an  increase 
of  only  $557,000,  or  3  per  cent.,  which  compares  most  un- 
favorably with  other  States. 

Baltimore  City  has  over  two-thirds  of  the  total  banking  capi- 
tal of  the  State. 

The  following  shows  the  changes  that  have  taken  place  in  the 
amounts  of  capital,  surplus  and  undivided  profits  in  ten  years  in 
Baltimore: 

1903.  1912. 

Capital   $12,403,260  $11,790,710 

Surplus  6,514,400  7,970,010 

Undivided  profits  1,532,060  2,082,787 

Compared  with  the  increases  of  banking  capital  that  have  oc- 
curred in  other  States,  the  Maryland  increase  is  far  from  satis- 
factory. 


288  Report  of  the  Commission 

ARE  THE  PRESENT  BANKING  RESOURCES  OF  MARY- 
LAND ADEQUATE? 

Innumerable  requests  have  been  made  by  the  commercial  in- 
terests in  Baltimore  for  increased  credits  and  for  a  development 
of  banking  facilities.  Any  person  interested  can  receive  sufficient 
assurances  that  the  business  interests  have  not  sufficient  available 
banking  funds  to  successfully  carry  on  their  business.  This  com- 
plaint is  not  exceptional,  but  general,  and  nearly  all  classes  of 
business  men  who  are  large  borrowers  must  have  either  Philadel- 
phia or  New  York  financial  connections. 

At  the  last  meeting  of  the  Legislature  many  business  men  testi- 
fied before  the  Finance  Committee  of  the  Senate  that  inducements 
had  been  made  to  have  them  do  all  of  their  banking  through  in- 
stitutions located  in  other  States. 

There  is  no  doubt  that  these  conditions  exist,  and  taxation  is 
an  important  factor. 


Taxation  of  Stock  of  Banks,  Etc. 


289 


AGGREGATE   RESOURCES   OF   ALL   BANKS   (WITH  TOTAL  NUM- 
BERS THEREOF)  OF  THE  TEN  LEADING  CITIES  IN 
THE  UNITED  STATES.     (JUNE  7,  1911.) 

CENTRAL  RESERVE  CITIES  (BANKS). 


National. 

Other 
Banks. 

Total 
Resources. 

1 

2 

4 

New  York 

Chicago 

St.  Louis 

40 

11 

8 

105 
73 

36 

145 
84 
44 

$4,568,137,868 

1,109,915,194 

418,439,401 

3 
5 

6 
7 
8 
9 
10 
11 


RESERVE  CITIES. 


Philadelphia 

Boston 

Cleveland 

Baltimore 

Pittsburgh 

Detroit 

Buffalo  (not  reserve  city). 
San  Francisco 


33 

73 

106 

20 

43 

63 

7 

23 

30 

17 

35 

52 

24 

57 

81 

3 

14 

17 

10 

37 

47 

1,042,911,827 
842,588,479 
323,331,544 
276,970,459 
534,792,016 
177,703,714 


462,160,002 


From  1911  Report  of  Comptroller  of  Currency.    Table  100,  page  806. 


PER  CAPITA  RESOURCES  OF  ALL  BANKS  IN  THE  TEN  LEADING 

CITIES. 


New  York .... 

Chicago 

St.  Louis 

Philadelphia . . 

Boston 

Cleveland 

Baltimore . . 
Pittsburgh . . . . 

Detroit 

Buffalo 

San  Francisco . 


$958 

48 

508  00 

609  OS 

673 

28 

1,256  65 

576 

75 

496  00 

1,001 

67 

381 

78 

1,084  57 


1910  Census.     1911  Report  of  Comptroller  of  Currency. 


290 


Report  of  the  Commission 


That  there  is  necessity  in  Baltimore  for  increase  of  banking 
capital  is  apparent  from  the  increase  shown  in  bank  clearances, 
the  increase  in  Baltimore  being  large  as  compared  with  the  in- 
crease of  clearances  in  other  cities. 

This  information  is  set  forth  in  the  following  table: 


COMPARATIVE  STATEMENT  OF  THE  EXCHANGES  OF  THE  CLEAR- 
ING  HOUSES  OF  THE  TEN  LEADING   CITIES   OF  THE 
UNITED  STATES  FOR  THE  YEARS  ENDING 
SEPTEMBER  30,  1912,  AND  SEPTEMBER 
30,  1911,  AND  PERCENTAGE 
OF  INCREASE. 


Exchange. 

Increase. 

Expressed  in 

Thousands. 

Percent- 

1912 

1911 

Increase. 

New  York 

$96,672,301,000 

$92,420,120,000 

$4,252,181 

4.5% 

Chicago 

14,864,488,000 

13,821,387,000 

1,043,111 

7.5% 

St.  Louis. . 

3,978,870,000 

3,827,444,000 

151,426 

3.9% 

Philadelphia. . 

7,878,577,000 

7,683,683,000 

194,894 

2.5% 

Boston 

8,865,807,000 

8,306,738,000 

559,069 

6.7% 

Cleveland 

1,101,007,000 

1,001,569,000 

99,438 

9.9% 

Baltimore 

1,893,003,000 

1,740,368,000 

152,635 

8.7% 

Pittsburgh 

2,687,970,000 

2,539,143,000 

148,827 

5.8% 

Detroit..   

1,087,893,000 

943,717,000 

144,176 

15.2% 

San  Francisco. 

2,621,035,000 

2,372,725,000 

248,310 

10.4% 

Table  101,  page  776,  Report  of  Comptroller  of  the  United  States,  1912. 

Objections  advanced  by  some  to  any  change  in  the  method  of 
taxing  banks  or  providing  for  a  classification  are  two:  Finst, 
the  statement  is  made  that  the  banks  of  Baltimore  are  already 
very  profitable,  and  second,  that  the  banks  do  not  enter  into  the 
commercial  activity  of  the  community. 

As  regards  the  first  objection,  there  is  confusion  in  the  minds 
of  some  persons  between  capital  stock  and  invested  capital.  While 
many  of  the  banks  in  Baltimore  and  Maryland  pay  large  divi- 


Taxation  of  Stock  of  Banks,  Etc. 


291 


dends  on  their  capital  stock,  the  only  fair  calculation  which  can 
be  made  is  as  to  what  return  this  dividend  represents  on  the  in- 
vested capital,  namely — capital,  surplus  and  undivided  profits. 
This  is  emphasized  by  the  fact  that  a  considerable  number  of 
banks  in  recent  years  have  had  additional  capital  stock  paid  in 
at  a  premium,  said  premium  going  to  the  surplus  account,  but  in 
reality,  and  as  far  as  income  yield  is  concerned,  being  part  of  the 
invested  capital. 
The  following  compilation  is  conclusive  on  this  point : 


EATIO   OF   EAENINGS   AND    DIVIDENDS   OF  NATIONAL  BANKS. 


New  York ... 

Chicago 

St .  Louis 

Philadelphia.  . 

Boston 

Cleveland 

Baltimore ...    . 
Pittsburgh . . . 

Detroit 

San  Francisco 


Ratio  of  Net  I       Ratio  of 
Earnings  to       Dividends  to 

Capital  Capital 

and  Surplus.  !  and  Surplus. 


9.48 

10.39 

8.34 

8.93 

5.17* 

6.97 

6.02 

3.93 

6.83 

4.67 

6.82 

5.99 

5.73 

5.63 

6.09 

5.05 

6.84 


5.26 


States — 

Northeastern  Group 

7.02 

4.92 

Eastern 

8.18 

6.94 

^  Southern 

9.62 

7.02 

TVI  iddle  W^estern 

8.19 

7.04 

AVpStPTTl           

11.95 
9.38 

y.ii 

Pacific 

7.19 

Table  59,  page  275,  Report  of  Comptroller  of  United  States. 

*Table  is  for  year  ending  July  1st,  1912.  On  July  1st  (  ?),  1912,  National 
Bank  of  Commerce  of  St.  Louis  charged  off  $5,748,000  accumulation  of 
losses. 


292 


Report  of  the  Commission 


From  this  it  appears  that  the  net  earnings  of  Baltimore  banks 
are  lower,  with  one  possible  exception,  than  any  other  city,  and 
further  examination  shows  that  little,  if  any,  earnings  are  passed 
to  surplus. 

As  regards  the  second  objection,  the  following  table  shows 
percentage  of  loans  and  discounts .  to  total  resources,  and  from 
this  tabulation  the  local  banks  are  high  in  percentage  of  loans: 


PERCENTAGE  OF  LOANS  AND  DISCOUNTS  TO  TOTAL  RESOURCES 

OF  NATIONAL  BANKS  OF  THE  TEN  LEADING  CITIES. 

(SEPTEMBER  4,  1012.) 


Loans  and  Discounts. 

Resources. 

Percent- 
age. 

New  York. 

$950,898,024  00 

321,980,303  88 

110,984,225  94 

232,705,012  94 

214,285,449  01 

56,542,491  47 

64,166,269  76 

138,169,756  35 

37,075,404  71 

$1,762,727,5.38  51 
571,760,771  90 
213,752,601  12 
440,526,799  47 
357,580,688  17 
104,839,707  34 
114,007,393  29 
295,086,128  55 
65,094,345  08 

53.9% 

Chicago 

St.  Louis 

Philadelphia 

Boston 

Cleveland 

Baltimore 

5Q.3% 
51.9ff 

52.8% 
59.9%  ■ 
53.9% 
56  2% 

Pittsburgh 

Detroit 

Buffalo 

46.1% 
56.9% 

San  Francisco 

119,489,975  57 

240,847,989  14 

49  6% 

TAXATION  AN  IMPORTANT  FACTOR. 


Adverse  tax  laws  directly  contribute  to  this  unsatisfactory 
condition. 

As  one  proof  of  this  fact,  there  may  be  recited  the  consolidation 
(January  1st,  1913)  of  the  Merchants  National  Bank  and  the 
Mechanics  National  Bank  into  the  Merchants-Mechanics  National 
Bank,  with  a  resultant  loss  of  banking  resources  of  $400,000.  In 
1911  the  National  Bank  of  Baltimore  absorbed  the  Third  National 
Bank,  with  an  aggregate  book  value  of  $646,000,  and  also  the 


Tax.stion  of  Stock  of  I).\xks,  Etc.  293 

Commercial  and  Farmers  National  Bank,  with  combined  capital, 
surplus  and  undivided  profits  of  $604,000. 

Immediately  thereafter  the  bank  (the  National  Bank  of  Balti- 
more) showed  increase  of  only  $180,000  of  banking  funds,  being 
a  loss  of  $1,030,000.  Within  recent  years  the  Manufacturers 
National  Bank,  with  capital,  surplus  and  undivided  profits  of 
$587,000,  went  out  of  business. 

Only  a  short  while  ago  the  Mercantile  Trust  and  Deposit  Com- 
pany retired  $500,000  and  the  Maryland  Trust  Company  retired 
also  $500,000.  On  April  1st,  1910,  the  Baltimore  Trust  and 
Guarantee  Company  and  International  Trust  Company  consoli- 
dated. Prior  to  consolidation  the  Baltimore  Trust  and  Guaran- 
tee Company  had  capital  of  $800,000  and  surplus  of  $2,000,000. 
The  International  had  $1,500,000  capital  and  $1,000,000  surplus. 
The  capital  of  the  consolidated  company — the  Baltimore  Trust 
Company— is  $1,000,000,  with  surplus  of  $2,500,000,  a  difl:erence 
of  $1,800,000  compared  with  the  two  companies. 

OBJECTIONS  TO  THE  LOCAL  METHOD. 

The  main  objections  to  a  continuation  of  the  present  system  of 
taxation  of  banks  may  be  stated  as  follows : 

First. — Banks  are  taxed  more  heavily  than  are  banks  in  most 
of  the  neighboring  States,  especially  in  those  States  with  which 
Maryland  is  in  competition. 

Second. — Banks  are  taxed  too  heavily  in  proportion  to  their 
earning  capacity. 

UNIFORMITY. 

It  is  desirable  that  the  same  kind  of  property,  subject  to  like 
protection,  should  be  subject  to  the  same  rate  of  taxation  in  all 
parts  of  the  State. 

Banks  depend  upon  the  community  interest  for  prosperity.  It 
is  quite  immaterial  where  the  shares  are  owned.  The  present  law 
in  Maryland  recognizes  the  community  value  because  it  provides 
that  the  proportion  of  shares  held  by  non-residents  shall  be  taxed 
where  the  bank  is  located.  The  present  method  of  imposing  vary- 
ing rates  of  taxation  on  the  shares  according  to  residence  of 
stockholders  is  the  worst  kind  of  fiction. - 


2  See  discussion  of  this  subject  ante:  "Taxation  of  Corporations." 


294  Report  of  the  Commission 

Because  of  the  difference  in  the  local  rates  of  taxation  assessed 
against  shareholders,  many  of  the  banks  in  Maryland  distribute 
to  certain  holders  who  reside  in  counties  with  a  low  tax  rate 
the  difference  between  the  maximum  rate  levied  against  any 
shareholder  and  the  rate  levied  against  the  particular  holder.  This 
is  termed  the  equating  of  taxation.  The  method  of  equating  is 
only  required  of  banks  in  one  other  State. 

THE  1  PER  CENT.  METHOD. 

Pennsylvania  enacted  in  1897  the  1  per  cent,  bank  tax  bill,  or 
a  tax  of  1  per  cent,  on  capital  of  banks  or  four  mills  on  capital, 
surplus  and  undivided  profits.  New  York,  in  1901,  passed  an  act 
imposing  1  per  cent,  on  capital,  surplus  and  undivided  profits,  and 
since  then  other  States  have  adopted  this  uniform  rate.  The  in- 
crease in  tax  revenue  from  banks  and  the  addition  of  large  sums 
of  bank  resources  have  justified  the  legislation  in  these  States. 

Every  special  commission  on  taxation  within  recent  years  which 
has  studied  this  particular  subject  has  reached  the  conclusion  that 
the  method  of  imposing  a  uniform  rate  is  sound. 

The  most  exhaustive  report  of  bank  taxation  is  that  contained 
in  the  "Report  of  the  Commission  on  Revenue  and  Taxation"  of 
the  State  of  California,  1906.  The  conclusions^  of  the  commis- 
sioners were  as  follows : 

First. — All  banks  and  all  moneyed  capital  should  be  taxed  alike 
(i.  c,  in  the  same  manner  and  at  the  same  rate). 

Second. — The  tax  should  be  a  State  tax  and  the  banks  should 
be  exempt  from  all  other  taxes  except  local  taxes  on  real  estate. 

Third. — The  tax  should  be  based  upon  the  capital  of  the  banks, 
including  accumulated  surplus  and  undivided  profits. 

Fourth.— The  shares  of  stock  should  be  assessed  or  valued  at 
their  book  value,  or  the  amount  paid  in  thereon,  plus  the  pro  rata 
of  the  accumulated  surplus  and  profits. 

Fifth. — The  rate  should  be  1  per  cent,  on  the  book  value  of 
the  shares,  less  real  estate  taxed  locally. 

Sixth. — All  real  estate  should  be  taxed  locally. 

Seventh. — Private  banks  and  bankers  should  be  taxed  in  the 
same  manner  as  other  banks  on  the  capital  employed  by  them  in 
their  business. 


^  Page  244  et  seq. 


Taxation  of  Stock  of  Banks,  Etc.  295 

The  recommendations  were  adopted  as  a  constitutional  amend- 
ment in  1910. 

The  Virginia  Commission  of  1912  considered  the  1  per  cent.^ 
tax  in  a  very  exhaustive  report. 

The  most  recent  recommendation  is  that  of  the  New  Jersey 
Commission,  April  1st,  1912.-'5  That  Commission  made  the  fol- 
lowing recommendations  to  the  Legislature  : 

"Banks  are  established  primarily  for  the  purpose  of  receiving 
deposits  and  discounting  paper.  The  argument  that  they  should 
be  treated  exactly  like  an  individual  citizen  is  fallacious.  They 
are  not  investing  institutions  and  cannot  properly  be  compared 
with  the  individual  citizen  who  buys  an  exempt  mortgage  or 
bond  for  investment  purposes  at  a  low  rate  of  interest.  The 
bank  is  dealing  in  money  in  substantially  the  same  manner  that 
the  merchant  deals  in  goods.  The  banking  business  should  pay  a 
fair  return  for  the  privileges  enjoyed,  especially  as  in  practice  the 
money  of  depositors  in  which  banks  deal  is  seldom  assessed. 

"We  believe  a  plan  of  taxing  banks  and  trust  companies  sub- 
stantially the  same  as  that  employed  in  Pennsylvania,  New  York, 
and  several  other  States  will  be  fair  to  these  institutions.     *     *     * 

"We  suggest  that  the  shares  of  banks  be  assessed  by  ascertain- 
ing and  adding  together  the  capital,  surplus  and  undivided  profits, 
and  deducting  therefrom  only  the  assessed  value  of  real  estate 
owned  by  the  bank,  the  balance  (to  be  divided  according  to  the 
number  of  shares  as  now)  to  be  taxed  at  the  fixed  rate  of  1  per 
cent.,  uniform  throughout  the  State.  This  would  place  all  banks 
on  a  parity  and  impose  the  same  rate  on  banking  capital  without 
regard  to  the  residence  of  the  shareholder.     *     *     * 

"We  believe  also  that  the  simplest  method  of  collecting  this 
tax  is  to  have  the  bank  collect  it  from  the  shareholder  (as  in 
New  York),  and  that  one-half  the  revenue  should  go  to  the  dis- 
trict where  the  bank  is  located  and  one-half  to  the  county.    *    *    *" 

The  conclusion  reached  by  the  special  committee  on  taxation  of 
the  National  Tax  Association  (1911)^  was  also  in  favor  of  the 
uniform  rate  of  taxation  of  banks. 


4  Chapter  V,  p.  211  of  the  Report. 

^'  Page  48  et  seq. 

6  Report,  Vol.  V  (1911),  p.  316. 


296         ■  Report  of  the  Commission 

DEDUCTIONS. 

New  York,  Pennsylvania,  California,  and  possibly  other  States, 
allow  no  deductions  for  real  estate  or  other  securities. 

The  present  law  of  Maryland  allows  deduction  of  real  estate, 
other  tax-paying  shares  and  non-taxable  securities  {e.  g.,  stock  of 
the  State  of  Maryland). 

Banks  of  Baltimore  are  also  entitled  under  the  Cans  act'  to 
a  credit  of  taxes  on  such  proportion  of  its  holdings  of  certain 
designated  city  stock  as  its  city  and  non-resident  holdings  bear 
to  the  whole  capital. 

Table  showing  percentages  of  increase  in  number  of  National 
Banks,  increase  in  capital  and  increase  in  deposit  of  National 
Banks  from  1902  to  1912: 


Percentage 
of  Increase  in 

Number  of 
National  Banks, 
1902-1912. 

New  England  States: 

Maine    — .16 

New   Hampshire .00 

Vermont  '.....  .04 

Massachusetts    — .  19 

Rhode  Island —.37 

Connecticut   — .02 

Eastern  States: 

New   York .29 

New   Jersey .53 

Pennsylvania  .37 

Delaware    .21 

Maryland  .24 

SoiitJiern  States: 

Virginia    .(:S> 

West  Virginia .68 

North   Carolina .73 

South  Carolina 1.19 

Georgia 1 .37 

Florida   1.28 

Alabama  .97 

Mississippi   .47 

Louisiana    .06 

Texas    .40 

Arkansas    2. 26 

Kentucky   .42 

Tennessee  .71 

( — )  indicates  a  decrease. 
7  Act  of  1908,  ch.  124. 


Percentage 

Percentage 

of  Increase  in 

of  Increase  in 

Capital  of 

Deposits  of 

National  Banks, 

National  Banks, 

1902-1912. 

1902-1912. 

—  .24 

.78 

—  .02 

.51 

—  .20 

.58 

—  .12 

.51 

—  .40 

.53 

—  .05 

.71 

.25 

.82 

.28 

1.21 

.23 

.65 

.09 

.49 

.03 

.65 

1.43 

1.65 

.78 

1.14 

1.38 

1.90 

1.03 

1.40 

1.55 

1.61 

2.28 

2.36 

1.21 

1.19 

.40 

.83 

1.03 

.54 

.74 

1.51 

2.43 

1.83 

.29 

.77 

.71 

.94 

Taxation  of  Stock  of  IJanks,  Etc.  297 

Percentage  Percentage             Percentage 

of  Increase  in  of  Increase  in        of  Increase  in 

Number  of  Capital  of              Deposits  of 

National  Banks,  National  Banks,     National  Banks, 

1902-1912.  1902-1912.  1902-1912. 

Middle  Western  States: 

Ohio    .16  .14  .51 

Indiana  .58  .53  .71 

Illinois .47  .58  .77 

Michigan    .13  .20  .90 

Wisconsin    .20  .34  .65 

Minnesota    .47  .36  1.53 

Iowa    .2,7  .?>i  .94 

Missouri   .58  .56  .53 

Western  States: 

South   Dakota .77  .84  1.58 

North  Dakota 1.06  .88  1.42 

Nebraska    .82  .56  1.14 

Kansas    .37  .22  .59 

Montana   1.52  .95  1.17 

Wyoming  .81  .76  1.29 

Colorado  1.30  .91  .27 

New  Mexico 1.05  .82  1.44 

Oklahoma 2.52  3.46  3.42 

Paeifie  Stales: 

Washington  1.35  2.49  1.56 

Oregon   1.37  2.38  1.51 

California  4.42  2.40  2.67 

Idaho  1.63  2.52  1.71 

Utah    .69  .93  1.35 

Nevada  10.00  20.24  9.77 

Arizona    .16  .74  1.13 

Compiled   from    report   of   Comptroller   of  the   Currency   of   the   United 
States,  19"  2. 


298 


Report  of  the  Commission 


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300  Report  of  the  Commission 


NOTKS. 

(1)  In  all  cases,  except  where  otherwise  stated,  the  real  estate  of  banks  is  subject  to 
the  same  taxes  as  the  real  estate  of  individuals,  payable  in  the  locality  where  it  is  situated. 

(2)  No  deduction  is  alloved  either  to  the  bant  or  to  the  shareholders  ou  accuunt  of 
debts,  etc. 

(3)  Total  tax  is  paid  to  the  County  Treasurer  where  bank  is  located,  regardless  of  place 
of  residtnce  of  sliareholders.  In  addition  to  the  special  tax  of  1  per  cent,  the  real  estate 
of  the  l)ank   is  subject  to  the  general  property  ta.\. 

(4)  All  property  in  Chicago  is  assessed  at  one-third  of  its  real  value,  so  that  the  tax 
rate  on  full  valuation  would  Ije  .?1.47. 

(.'•I  Taxes  are  payable  in  county  where  bank  is  located,  regardless  of  place  of  residence 
of  shareholders,   but  to  the  City.   State,   County,  etc..  according  to  their  respective  levies. 

(6l  In  addition  to  the  special  tax,  the  real  estate  of  the  bank  is  subject  to  the  general 
property  tax  where  it   is  located. 

(7)  The  State  Board  of  Equalization  fixes  the  basis  of  assessment,  usually  about  50 
per  cent,   of  real  value,   the  same  basis  used  for  other  classes  of  property. 

(8)  The  State  Tax  Commissioner  of  Massachusetts,  in  a  letter  of  March  14.  191:'., 
writes  as  fidlows  : 

"The  shares  of  stock  of  national  banks  located  in  Massachusetts  are  iiersonal  prjperty 
subject  to  taxation  under  tlie  laws  of  this  Commonwealth.  The  tax  upon  all  shares  of 
each  national  bank  is  laid  as  a  tax  uiwn  the  individual  sliareholders.  but  the  tax  is  made 
payable  by  the  l)ank  directly  to  tlie  treasury  of  the  city  in  which  the  bank  is  located;  in 
the  payment  of  this  tax.  the  bank  is  the  agent  of  the  shareholders ;  and  for  the  recovery 
from  the  shareholders  of  the  tax  paid  by  the  bank,  on  account  of  shares  of  stock,  the 
bank  has  a  lien  upon  such  shares.  The  rate  at  which  the  shares  of  stock  of  n  itional  banks 
are  thus  taxed  is  the  rate  i:revailing  for  the  then  current  year  in  the  city  or  town  in 
which  the  bank  is  located.  Full  details  as  to  the  assessu:ent  and  as  to  the  residence  of  the 
different  shareholders  are  submitted  each  year  by  every  Board  of  Assessors  to  this  depart- 
ment, and  it  is  the  business  ot  this  department  by  a  system  of  debits  and  credits  to  see  to 
it  that  eventually  each  cit.v  and  town  receives  the  tax  paid  by  all  national  banks  in  this 
Commonwealth  on  account  of  any  shares  of  stock  owned  by  residents  of  such  city  or  town. 
The  tax  upon  shares  of  national  banks  located  in  Massachusetts,  which  shares  are  owned  by 
non-residents  of  Massachusetts,  is  retained  by  the  Commonwealth  herself  aud  is  collected 
by  the  Commonwealth  from  the  cities  and  towns  to  which  such  tax  has  in  the  first  instance 
been  paid. 

"The  shares  of  stock  of  trust  companies  and  of  national  banks  taxed  as  herein  indicated 
are  valued  at  the  market  value.  This  market  value  may  or  may  not  closely  corresijond  to 
the  aggregate  of  the  capital  surplus  and  undivided  profit.  In  the  case  of  such  national 
banks  or  trust  companies  as  have  no  market  value  for  the  shares  of  stock  established  by 
actual  transactions  in  the  market,  the  valuation  placed  upon  the  shares  by  the  local  Boar.l 
of  Assessors  or  by  the  Tax  Commi'^sioner.  as  the  case  may  be  (i.  e.,  by  the  former  in  the  case 
of  national  banks,  by  the  latter  in  the  case  of  trust  companies)  will  very  closely  corre- 
spond to  the  aggregate  of  the  capital,  surplus  and  undivided  profits.  In  such  cases,  how 
ever,  an  item  of  major  importance  in  the  determination  of  the  share  value  will  be  the 
dividends  paid  by  the  institution.  In  Massachusetts  we  have  no  county  tax  as  suggested. 
Taxes  are  assessed  by  and  paid  to  one  of  two  authorities. — first,  the  city  or  town  ;  second, 
the  State.  In  all  cases  the  rate  at  which  property  is  taxed  by  the  cit.v  or  town  is  the 
rate  prevailing  in  such  city  or  town  for  the  then  current  year.  As  a  matter  of  fact,  for 
the  year  1912  tliese  municipal  rates  varied  from  as  low  as  $3.00  per  thousand  to  as  high 
as  $25.00   or  .$2«.00  per  thousand." 

(9 1  County  authorities  assess  the  shares,  but  final  valuation  is  fixed  by  the  State  Tax 
Commission. 

(10 1  Taxes  payable  in  county  where  bank  is  located,  regardless  of  place  of  residence  of 
shareholders. 

(11)  Actual  worth  or  fair  selling  value,  and  not  book  value,  is  contemplated  by  the 
Constitution.      Schley  vs.   Montgomery  Co.,   106  Md.   407. 

(12)  The  net  assessed  value  of  the  shares  of  other  Maryland  banks  or  corporations 
owned  by  the  bank  on  January  1st  and  six  months  before  is  allowed  as  a  credit  against 
all  the  shares  of  the  bank.  Certain  issues  of  Baltimore  City  stock  (if  owned  January  1st 
and  six  months  before)  are  allowed  as  a  proportionate  credit,  but  only  against  shares 
taxable  in  Baltimore  City,  which  includes  shares  held  by  non-residents  of  the  State.  See 
Code  P.  G.  L.    (Bagby's  Ed.),  Art.  81.  Sec.   1(S3. 

(13)  The  direct  State  tax  of  23%  cents  (for  1912)  is  charged  upon  the  entire  net  as- 
sessed value  of  the  shares.  The  general  property  rate  in  Baltimore  for  local  purposes  is 
$1.89  (1912)  making  total  rate  of  $2.12%  on  shares  taxable  in  Baltimore.  The  local 
tax  on  shares  is  paid  at  the  respective  local  rates  and  to  the  respective  localities  where 
the  shareholders  reside.  Shares  of  non-residents  of  the  State  are  taxed  in  the  locality 
where  the  bank  is  situated. 

(14)  To  equalize  with  real  estate  and  other  property,  all  of  which  is  assessed  at  75 
per  cent,  of  real  value. 

(15)  The  40-cent  rate  also  applies  to  all  intangible  property  and  savings  deposits. 
(If))    To  equalize  with   real  estate,   which   is  assessed  at  00  per  cent,   of  real   value. 

(17)  Ileal  estate  of  bank  not  assessed,   as  it  is  included  in  value  of  shares. 

(18)  The  real  estate  of  banks  subject  to  local  taxes,  but  the  amount  of  said  taxes  is 
deducted  from  the   1   i)er  cent  tax  on   market  value  of  shares. 

(19)  Special  rate  for  State  is  35  cents,  and  in  addition  the  regular  city  tax  rate,  which 
for   1912  was  $1.40. 

(20)  Section  17  of  the  law  relating  to  "Tax  on  Banks  and  Trust  and  Security  Com- 
panies" contains  the  following: 

"In  assessing  said  shares  there  shall  be  deducted  from  the  actual  values  of  the  shares 
held  by  the  stockholders  the  amounts  of  bonds,  demands  and  claims  owing  by  them  as 
principal  debtors  and  not  otherwise  ileilu<-te<l  from  their  taxable  i>roperty.  but  not  deducting 
any  money  that  ma.v  be  due  on  accoinit  of  the  piu'chase  of  securities  which  are  non-taxable; 
provided  that  such  deductions  from  the  assessments  of  such  shares  of  any  bank,  banking 
association,  trust  or  securit.v  company  shall  not  in  any  case  exceed  ten  per  centum  of  the 
total  actual  value  of  all  its  shares  of  stock." 


Taxation  of  Stock  of  I^anks,  Etc. 


301 


TABLE*  SHOWIXa  AMOUNTS  OF  DEPOSITS  IN  THE  SAVINGS 
BANK,  SUBJECT  TO  THE  FRANCHISE  TAX  OF  25  CENTS  ON 
THE  HUNDRED  DOLLARS,  IN  THE  SEVERAL  COUNTH^:S  AND 
BALTIMORE  CITY  AS  REPORTED  TO  THE  STATE  TAX  CO.M- 
MISSIONER,  JANUARY  Lsr,  IPll. 


No.  of  Banks 
Reporting. 

Deposits. 

1 

$101,657  12 

1 

678,816  00 

20 

88,099,719  71 

2 

147,416  85 

0 

0 

0 

0 

5 

829,091  01 

0 

0 

1 

34,207  00 

0 

0 

9     - 

3,536,854  02 

0 

0 

1 

61,271  00 

0 

0 

0 

0 

1 

991,525  00 

0 

0 

1 

26,000  00 

0 

0 

0 

0 

3 

113,414  23 

4 

1,111,808  96 

0 

0 

3 

233,592  23 

52 

$95,86.5,373  13 

Allegany 

Anne  Arundel. . . . 
Baltimore  City  • . . 
Baltimore  County 

Calvert 

Caroline 

Carroll 

Cecil 

Charles 

Dorchester 

Frederick 

Garrett 

Harford 

Howard 

Kent  

Montgomery 

Prince  George's. . 
Queen  Anne'.s  . . . 

St.  Mary's 

Somerset 

Talbot 

Washington 

Wicomico 

Worcester 


The  State. 


'Compiled  from  Table  C,  No.  2,  Report  of  State  Tax  Commissioner,  1912. 


302  Report  of  the  Commission 

TRUST  COMPANIES. 

The  shares  of  trust  companies  are  assessed  in  the  same  man- 
ner as  shares  of  other  corporations,  and  the  tax  thereon  paid  in 
the  same  manner. 

In  addition  to  the  tax  on  sliares,  trust  companies  pay  a  State 
tax  or  franchise  tax  of  2i/.  per  cent,  upon  their  gross  receipts 
or  earnings.^ 


'&" 


SAVINGS  BANKS. 

Article  81,  section  91,  provides  as  follows:  "Every  savings 
bank,  institution  or  corporation  organized  for  receiving  deposits 
of  money  and  paying  interest  thereon  shall  pay  annually  a 
franchise  tax,  to  the  amount  of  I/4  of  1  per  centum  on  the  total 
amounts  of  deposits  held  by  such  savings  bank,  institution  or  cor- 
poration.    *     *     *     *" 

Examination  of  the  report  of  the  Bank  Commissioner  shows 
that  banks  other  than  banks  designated  as  savings  banks  have 
savings  deposits  or  time  deposits,  and  from  report  of  the  Comp- 
troller, many  of  these  are  not  taxed. 

The  law  no  doubt  contemplates  that  all  savings  deposits  should 
be  subject  to  a  like  tax.  In  some  counties  there  are  no  deposits 
of  savings  paying  the  franchise  tax. 

INSURANCE  COMPANIES. 

Foreign  insurance  companies  are  required  to  pay  an  annual 
license;  the  charge  for  life  companies  is  $300,  and  for  all  others 
$100.  Prior  to  1913,^  all  companies  paid  $300  except  casualty 
companies. 

Foreign  fire,  marine  and  inland  companies  pay  a  tax  of  2  per 
cent,  on  amount  of  premiums  collected  in  the  State,  with  allow- 
ance for  sums  paid  for  re-insurance  and  cancellations ;  the 
premium  of  life  and  casualty  companies  is  1^  per  cent. 

In  addition,  agents  of  foreign  companies  each  pay  an  annual 
license  of  $10.  In  some  other  States  this  agent's  fee  of  $10  is 
imposed  only  against  corporations  of  those  States  which  impose 


8  Article  81,  section  167. 


Taxation  of  Stocks  of  Banks,  Etc.  303 

a  similar  fee,  and  this  retaliatory  measure  works  to  the  disad- 
vantage of  some  Maryland  corporations. 

Domestic  companies  pay  a  gross  receipts  tax. 

The  fiscal  year  of  the  Insurance  Department  is  from  December 
1  to  November  30,  while  the  fiscal  year  of  the  Comptroller  is  from 
October  1  to  September  30,  w^hich  makes  it  impossible  to  make 
an  exact  comparison  of  any  given  period.  They  should  be 
uniform. 


BIBLIOGRAPHY. 

"Taxation  of  Corporations,"  Part  II,  published  as  a  report  of  the  Com- 
missioner of  Corporations,  U.  S. 


9  Acts  of  1912,  ch.  207. 


Taxation  of  Intangible  Personal  Property  305 

TAXATION  OF  INTANGIBLE  PERSONAL 

PROPERTY. 

By  "intangible  personal  property"  is  meant  corporate  bonds 
and  certificates  of  indebtedness  and  the  stock  of  foreign  corpora- 
tions, taxed  at  a  rate  according  to  the  classification  as  provided 
under  Article  81,  Section  214,  of  the  Code  of  Public  General 
Laws.    The  term  elsewhere  implies  money,  credits  and  securities. 

Under  the  Maryland  law  such  securities  are  taxed  in  all  com- 
munities at  the  uniform  local  rate  of  30  cents  on  the  $100  of 
value,  or  3  mills,  and  in  addition  are  subject  to  the  State  rate. 
The  State  tax  in  1913  was  31  cents  on  the  $100,  making  the  aggre- 
gate of  taxes  to  be  paid  on  a  bond  assessed  at  $1,000,  $6.10 
Prior  to  the  increase  of  the  State  rate  from  16  cents  on  the 
hundred,  there  was  little  objection  to  the  sum  of  the  rates  im- 
posed. Objection  is  made,  and  with  much  justice,  that  the  total 
taxes  are  too  high,  and  that  the  good  effect  and  intent  of  the 
law  are  lost. 

This  condition  raises  the  question  of  classification  for  State 
purposes,  which  eventually  may  have  to  be  considered.  The 
State  rate  should  not  be  greater  than  the  local  rate.  The  law 
should  provide  for  a  maximum  aggregate  rate  and  an  equitable 
division  between  the  State  and  the  localities.  (3n  a  4I/2  per  cent, 
investment  of  $1,000,  yielding  $45  a  year,  a  tax  of  $6.10  is  too 
high  for  this  class  of  property. 

The  30  cents  per  $100,  or  3  mill  tax,  is  a  local  rate.  Many 
of  the  holders  of  such  securities  live  in  communities  which  have 
a  municipal  rate  of  taxation  in  addition  to  the  county  rate.  The 
percentage  of  the  division  of  the  sum  between  the  counties  and 
municipalities  shows  no  uniformity.  Some  counties  return  to 
municipal  officers  15  cents  on  $100  (or  li/-  mills)  for  resident 
holders  within  the  municipalities,  while  some  report  no  con- 
tribution. 

In  some  counties  of  Maryland  assessment  of  "securities,"  so 
called,  are  in  reality  promissory  notes  of  firms  and  individuals 
assessed  at  a  percentage  of  value  as  fixed  by  the  Act  of  1896, 
chapter  120,  section  194. 

The  theory  of  the  Maryland  law  which  taxes  this  class  of 
property  at  a  low  rate  is  sound  in  principle,  and  has  been  the 


306  Report  of  the  Commission 

subject  generally  of  favorable  comment  by  students  of  taxation. 
Numerous  special  commissions  on  taxation  have  been  impressed 
with  results  in  Maryland,  which  results,  unfortunately,  have  not 
been  generally  satisfactory  up  to  the  present  time. 

Many  citations  could  be  incorporated  commending  the  Mary- 
land method,  but  Professor  Bullock,  of  Harvard,  has  summa- 
rized it  in  a  way  that  is  striking.    He  says,  among  other  things : 

"The  experience  of  Pennsylvania  and  Maryland  under  im- 
perfect laws  and  with  imperfect  methods  of  administration  should 
lead  to  a  revision  of  the  opinion  that  it  is  impossible  to  collect  any 
sort  of  a  tax  on  intangible  wealth.  Is  it  not  possible  that  these 
commonwealths  have  found  a  practical,  if  not  an  ideal,  method 
of  removing  the  worst  evils  in  American  State  and  local  tax- 
ation?"! 

SECURED  DEBT  TAX  OF  NEW  YORK. 

The  present  secured  debt  law  of  New  York  is  in  sharp  con- 
trast to  the  Maryland  law  providing  for  a  low  annual  rate  on 
classified  intangible  personal  property. 

In  1911,  New  York  State  extended  its  method  of  commuting 
taxes  on  certain  classes  of  intangible  personal  property  through 
the  enactment  of  the  "secured  debt"  tax  law.  The  plan  of  the 
measure  is  practically  the  same  as  that  which  has  been  applied  to 
mortgage  taxation  in  that  State  for  several  years  past. 

The  "secured  debt"  tax  is  designed  to  reach  bonds  and  other 
debts  secured  by  mortgages  upon  property  in  any  State  other 
than  New  York.  It  resembles  the  mortgage  recording  tax  in 
that  the  rate  is  the  same  (I/2  of  1  per  cent.)  and  in  the  further 
fact  that  it  is  paid  but  once,  and  having  been  paid,  the  security 
upon  which  it  is  levied  is  exempt  from  all  other  direct  taxes.  It 
ditfers  from  the  mortgage  recording  tax  in  that  it  is  optional 
nistead  of  compulsory,  and  is  entirely  for  State  purposes,  whereas 
the  mortgage  recording  tax  is  for  State  and  local  purposes.  The 
rate  of  both  these  taxes  is  low — very  low,  indeed — when  the  life 
of  the  security  extends  over  a  long  period  of  years,  and  it  cannot 
be  considered  as  the  equivalent  of  the  annual  rate  adopted  in 
any  of  the  States  which  have  inaugurated  the  low  uniform  rate 


1  "The   Taxation   of   Intangible   Property,"   2nd   vol.   International   Tax 
Association  Report.  137. 


Taxation  of  Intangible  Personal  Property  307 

system  of  taxing  securities.  The  owner  of  a  bond  running  for 
five  years  pays  the  same  rate  of  tax  that  he  would  pay  if  the  bond 
were  to  run  100  years,  and  it  is  urged  by  many  friends  of  the 
tax  that  this  inequality  should  be  corrected. 

The  "secured  debt"  tax  law  permits  the  holder  of  the  security 
to  present  it  or  a  description  of  it  to  the  State  Comptroller,  pay 
a  registration  tax  of  I/2  of  1  P^^  cent,  upon  its  face  value,  have 
a  stamp  to  that  eifect  affixed  and  canceled  by  the  State  Comp- 
troller, and  thereafter  to  hold  such  security  free  from  State  and 
local  taxation,  or  to  sell  it  as  tax  exempt.  The  application  to 
have  the  security  taxed  by  this  method  is  of  course  purely  volun- 
tary. But  the  impulse  to  make  the  application  is  greatly 
strengthened  by  the  provision  in  the  law  that  the  holder  of  the 
secured  debt  who  has  failed  to  register  his  securities  is  denied 
the  right  to  oft"set  his  just  debts  against  the  secured  debts.  The 
holder  knows  also  that  if  he  does  not  have  his  securities  regis- 
tered and  fails  to  conceal  them  from  the  assessor,  he  will  have 
to  pay  the  general  property  tax  for  State  and  local  purposes 
upon  the  full  face  value  thereof,  and  this  would  amount  even  in 
one  year  to  several  times  as  much  as  he  would  have  to  pay  by  the 
secured  debt  tax  method. 

The  receipts  from  the  tax  in  the  year  ending  September  30, 
1912,  was  about  $1,800,000,  and  the  expense  of  collection  was 
only  about  $25,000.  A  large  part  of  this  is  new-found  revenue, 
as  it  comes  from  a  class  of  property  which  is  generally  concealed 
from  the  assessor.  It  is  the  general  impression  that  the  receipts 
will  decrease  when  most  of  the  bondholders  of  the  State  have 
registered  their  bonds,  but  the  constantly  increasing  sale  in  New^ 
York  of  bonds  of  public  service  corporations  may  in  a  large 
measure  compensate  for  this  factor.  Railroad  and  other  bonds 
can  be  sold  tax  exempt  if  they  have  been  registered  under  the 
secured  debt  tax  law,  and  thus  they  enter  into  competition  with 
public  bonds  for  the  capital  available  for  the  purchase  of  tax- 
exempt  securities.  It  is  contended  that  this  factor  has  a  decided 
tendency  to  lower  the  prices  obtainable  by  the  State  and  munici- 
palities in  the  sale  of  their  bonds  and  that  for  this  reason  the 
real  benefits  derived  from  the  tax  are 'greatly  diminished. 

^klichigan  in  1913  adopted  a  secured  debt  law  similar  to  the 
New  York  act. 


308  Report  of  the  Commission 

THE  ADMINISTRATION  OF  THE  LAW  IN  MARYLAND. 

In  Maryland,  as  elsewhere,  the  great  problem  is  in  actually  dis- 
covering the  stocks  and  bonds  held  within  the  State.  This  task  is 
difficult.  Owners  of  stocks  and  bonds  are  not  apt  to  disclose  the 
ownership  of  these  securities  except  under  strong  pressure.  The 
ownership  of  a  large  proportion  of  the  stocks  and  bonds  held  in 
Maryland  is  never  disclosed  in  the  lifetime  of  the  holders,  but 
comes  to  light  upon  the  settlement  of  their  estates.  If  the  rate 
of  taxation  against  stocks  and  bonds  is  high,  the  owners  are  much 
less  liable  to  voluntarily  disclose  them  than  if  the  rate  is  low. 

An  illustration  of  this  occurs  in  Baltimore.  The  Maryland 
law  for  the  taxation  of  intangible  personal  property  was  passed 
in  1896,  following  the  Pennsylvania  act,  and  provided  for  a  uni- 
form rate  of  3  mills  throughout  the  State,  in  addition  to  the  State 
rate,  which  at  that  time  was  17%  cents  on  the  $100.  This  rate 
superseded  a  local  rate  in  Baltimore  of  about  $2.00,  plus  the 
State  rate,  under  which  there  were  at  that  time  only  about 
$6,000,000  worth  of  securities  on  the  tax  books  of  the  city. 

The  following  have  been  the  assessments  in  Baltimore  since 
the  present  law  went  into  effect : 

1897 $58,703,795  1906 $120,423,814 

1898 60,699,686  1907 150,947,733 

1899 61,890,764  1908 146,688,857 

1900 65,789,903  1909 148,234,010 

1901 68,879,484  1910 158,666,848 

1902 89,880,484  1911 165,834,235 

1903 94,336,562  1912 179,412,676 

1904 85,971,333  1913 177,385,419 

1905 104,221,227  1914 ••  191,970,999 

It  is  impossible  to  say  what  percentage  of  the  total  securities 
owned  in  Baltimore  that  these  assessments  represent.  The  Balti- 
more City  Commission  2  of  1907,  which  devoted  a  great  deal  of 
time  to  a  study  of  this  particular  subject,  made  the  following 
comment  on  this  phase  of  the  subject : 

"The  total  assessment  of  'securities'  in  Baltimore  for  the  1908 
basis  is  $146,688,857.  This  aggregate  is  made  up  from  precisely 
3,300  separate  accounts.     Of  these  3,300  accounts,  8  accounts 


-  Report  of  the   Advisory   Committee  on   Taxation   and   Revenue.    1907, 
p.   146. 


Taxation  of  Intangible  Personal  Property  309 

are  corporations  returning  $52,408,092,  or  35.7  per  cent,  of  the 
total  basis;  1,011  accounts  are  trust  estates  returning  $26,906,838, 
or  18.3  per  cent,  of  total  basis,  and  2,281  accounts  are  individuals 
returning  $67,373,927,  or  46  per  cent,  of  the  total  basis. 

"That  there  are  within  the  entire  city  limits  of  Baltimore,  and 
out  of  its  total  population  of  at  least  550,000  souls,  only  some 
2,281  persons  who  own  'securities' — whereas  no  less  than  1,011 
trust  estate  accounts  are  so  favored — is  either  an  astonishing 
revelation  or  a  manifest  absurdity.  It  should  be  clearly  remem- 
bered that  such  tax-liable  'securities'  include  every  kind  of  bond 
or  certificate  of  indebtedness — except  such  well-understood  ex- 
emptions as  the  obligations  of  the  United  States,  the  State  of 
Maryland  and  the  city  of  Baltimore — and  every  kind  of  cor- 
porate stock  other  than  the  shares  of  Maryland  incorporated 
companies.  To  accept  the  testimony  of  the  city's  tax  books  and 
believe  that  the  entire  individual  ownership  of  such  forms  of 
wealth  in  Baltimore  is  concentrated  in  2,281  persons  is  an  impos- 
sible strain  upon  even  the  most  optimistic  credulity.  It  would 
mean  either  that  Baltimore  is  the  meanest  and  poorest  of  cities 
as  to  personal  wealth  or  that  the  concentration  of  such  wealth 
in  the  hands  of  a  limited  number  of  individuals  has  advanced 
farther  than  in  any  civilized  community  in  the  world. 

"Of  course,  neither  of  these  fanciful  assumptions  has  a 
vestige  of  truth.  The  fact  that  only  2,281  individuals  return 
holding  of  taxable  securities  can  only  have  one  possible  explana- 
tion to  any  reasonable  mind,  and  that  is  that  the  existing  meth- 
ods of  assessment  fail  to  secure  anything  like  thorough  return 
for  purposes  of  taxation  of  such  forms  of  wealth." 

If  this  criticism  was  applied  to  Baltimore  City,  after  the  im- 
portant results  obtained,  what  would  be  the  criticism  of  the 
assessment  of  intangible  property  in  the  counties,  where  results 
have  been  much  more  meagre? 

In  1912  there  was  no  assessment  of  this  class  of  property  in 
four  counties,  viz :  Calvert,  Caroline,  Garrett  and  Worcester. 
There  is  no  information  at  hand  showing  the  change  of  assess- 
ments of  this  classification  in  the  other  counties,  but  it  is  within 
the  range  of  possibility  that  some  counties  have  at  present  less 
securities  on  their  books  than  in  1896. 


310  Report  of  the  Commission 

Tax  officials  in  the  counties  of  the  State  complain  of  the  great 
difficulty  in  ascertaining  this  class  of  property,  and  comment  on 
the  small  part  assessed. 

The  following  table  shows  the  amount  in  each  county : 

AMOUNT  OF  STOCKS  AND  BONDS  ASSESSED  FOR  THE  YEAR 
1912  IN  EACH  COUNTY  AND  BALTIMORE  CITY  SUBJECT 
TO  THE  UNIFORM  LOCAL  RATE  OF  30  CENTS  PER  $100. 
(STATE  TAX  PAID  THEREON  IN  ADDITION.) 

Allegany  $439,526  00 

Anne  Arundel  567,985  00 

Baltimore  City  179,412,676  00 

Baltimore  County   42,589,400  00 

Calvert  None 

Caroline  None 

Carroll    2,177,802  00 

Cecil    2,423,290  00 

Charles    243,627  00 

Dorchester   205,124  00 

Frederick    1,876,935  00 

Garrett   None 

Harford   1,448,564  00 

Howard   1,134.346  00 

Kent    248,620  00 

Montgomery  1,108,865  00 

Prince   George's    142,879  00 

Queen  Anne's    313,33100 

St.  Mary's   88,829  00 

Somerset   * 

Talbot   560,437  00 

Washington   1,808,634  00 

Wicomico    1,040,475  00 

Worcester   None 

Total $237,822,345  OOt 


BIBLIOGRAPHY. 

"Municipal  Taxation  of  Intangible  Wealth" — Jacob  H.  Hollander — 1st 
vol.  National  Tax  Association  Report,  p.  406. 

"A  Classified  Property  Tax" — Charles  J.  Bullock — 3rd  vol.  National  Tax 
Association  Report,  p.  95. 

"The  New  York  'Secured  Debt'  Law" — Edward  L.  Heydecker — 6th  vol. 
National  Tax  Association  Report,  p.  251. 

"Classified  Personal  Property  in  Maryland" — ^Oscar  Leser — 4th  vol. 
National  Tax  Association  Report,  p.  380. 

Third  Biennial  Report  of  the  State  Tax  Commission  of  West  Virginia 
(for  compilation  of  reports  of  special  commissions). 

"Taxation  of  Intangible  Property  in  Maryland" — Report  of  the  Minne- 
sota Tax  Connnission,  1910,  p.  190. 


*Amount  not  ascertainable. 
tOne  county  not  included. 


Inheritance  Taxation  311 


INHERITANCE  TAXATION. 

In  about  five-sixths  of  the  States,  there  are  statutes  imposing 
some  form  of  tax  on  inheritances,  and  in  most  of  these  States 
the  tax  applies  not  only  to  collateral  inheritances  but  to  direct 
inheritances  as  well.  Maryland  was  one  of  the  first  States  to 
impose  the  tax,  being  preceded  only  by  Pennsylvania,  Louisiana 
and  Virginia.  Since  the  enactment  of  the  original  provision  in 
1845  there  has  been  very  little  change  in  our  inheritance  tax  law 
with  the  exception  of  the  increase  in  rate  in  1908  from  2^2  p^r 
cent,  to  5  per  cent.  While  this  increase  in  rate  has  materially 
added  to  the  State  revenue,  it  must  be  remembered  that  the 
burden  is  still  placed  entirely  upon  collateral  inheritances,  and 
that  in  contrast  to  the  trend  of  legislation  in  other  States  the 
rate  is  fixed  and  not  progressive. 

The  following  table  is  submitted  for  the  purpose  of  showing 
a  general  comparison  of  the  Maryland  inheritance  tax  with  those 
of  other  States : 


312 


Report  of  the  Commission 


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314  Report  of  the  Commission 

There  is  claimed  to  be  some  sentiment  among  the  people  of 
Maryland  that  our  tax  on  inheritances  should  be  extended  to 
apply  to  inheritances  and  transfers  passing  to  direct  heirs. 

The  suggestion  has  also  been  made  that  the  exemption  against 
estates  passing  to  collaterals  should  be  enlarged  and  the  present 
fixed  rate  should  be  changed  to  a  progressive  rate.  Under  the 
present  Maryland  law  estates  of  $500  do  not  pay  the  inheritance 
tax.  This  exemption  applies  to  the  total  estate,  and  hence  any 
estate  over  $500  left  equally  to  a  number  of  different  heirs  would 
be  taxed,  although  the  individual  share  may  be  very  small.  It 
would  seem  that  the  exemption  should  be  varied  according  to 
the  degree  of  consanguinity  and  that  it  should  apply  to  each 
beneficiary  and  not  to  the  estate  as  a  whole. 

The  policy  of  Maryland  has  been  to  confine  the  inheritance  tax 
to  the  estates  of  resident  decedents  and  tangible  property  located 
within  the  State  belonging  to  estates  of  non-residents.  The  State 
has  never  attempted  to  apply  the  tax  to  stocks  in  Maryland  cor- 
porations owned  by  estates  of  non-resident  decedentr  and  to  cer- 
tain other  forms  of  intangible  property  of  estates  of  non-resident 
decedents.  While  several  of  the  States  have  adopted  the  policy 
of  making  the  tax  apply  to  intangible  property  of  non-resident 
estates. wherever  there  was  any  legal  opportunity  of  levying  the 
tax,  the  tax  should  not  be  made  to  apply  where  the  conscience 
would  clearly  show  that  such  a  tax  would  be  unjust.  It  is  impos- 
sible, however,  for  Maryland  to  adopt  a  policy  which  will  elimi- 
nate all  possibility  of  double  taxation  on  inheritances,  and  the  fact 
that  this  State  is  most  liberal  in  the  exemption  of  estates  of  non- 
resident decedents  does  not  guarantee  that  other  States  will  adopt 
the  same  liberal  policy.  Its  example  should,  however,  exert  an 
influence  against  double  taxation,  and  it  should  not  be  influenced 
to  change  its  policy  in  the  matter  by  the  mere  fact  that  some 
other  States  have  adopted  a  selfish  policy. 

During  the  fiscal  year  ended  September  30,  1912,  the  State 
received  from  the  collateral  inheritance  tax  $289,600. 

The  following  table  shows  a  classification  adopted  largely  from 
several  States  which  are  administering  the  inheritance  tax  on 
the  progressive  rate  plan : 


Inheritance  Taxation 


315 


•000'000'T$  J3'^0 


"OOO'OOO'l^ 
J3AO  :ioii  jnq 

'000'0S6$  J^^O 

wo'oszt 

JOAO  }oii  ;nq 
'000'09$    -13AO 

■ooo'osi 

J3AO  }ou  ;nq 
'000'S2$    -13-^0 


X 

CT3 

•4-t 

^ 

^ 

^ 

^ 

o 

Tf 

-o 

00 

o 

•^ 

1-H 

X 

ci 

-M 

^ 

^ 

^ 

^ 

^ 

<^ 

irj 

c^ 

o\ 

X 

C8 

•4-* 

^ 

^ 

^ 

^ 

o 

<Na 

'^ 

\o 

C30 

X 

ni 

-4-> 

^ 

^ 

^ 

^ 

o 

1— 1 

CO 

U-) 

f^ 

WO'SZt 
J3AO  ^ou  ;nq 

'OOO'OIS    Ja^O 

"OOO'OlJ 
J3AO  ;ou  jnq 

'000' I  $  J  3  A  o 


-un  JO 


000'1$ 


X 
+-» 
O 

X 

o 
2; 


X 
-1-1 
O 


X 

O 

:5 


^  ^  ^ 

CM     ro     'O 


^ 

^ 

^ 

I— 1 

CM 

lo 

X 

X 

X 

a 

rt 

rt 

■*-> 

-M 

-4-1 

o 

o 

O 

^ 

^ 

^ 

< 

h- 1 

u 

I — I 


'-    u    ^ 

•-  3c; 

°       ""       rt 

S2  o  -- 
o       ^ 

<L)    3    iH 

•-  i:  o 
o  •-  >> 


5co 


o 

-a 

rt 


V 


-a    r-    <u    _ 


.S^S  ^ 


-  S.H 


^  o 


3 


en   u 
tn  ^ 
-   2  =2 
U 


rt-r 


•ar:: 


en   a 


WO"-" 

5   tn   <u 
O      ^;g 

Q-i        Go 


1)  rt    '-' 

X  a  =3  .- 


HH  I— I 


r  cc  o 

•^  r3   <:;  -o 
-3  ->-'  ■- 

CJ  (L)    O 

--  CJ  ^    t- 

-  en   r;   O 
1 


y 

o 


\E  o    m 


tn 


•5     O 
o    „ 


CM 


■^     U-) 


316  Report  of  the  Commission 

Bequests  to  charitable,  educational  and  religious  institutions 
are  taxed  in  Maryland  at  the  same  rate  as  other  collateral  be- 
quests. In  considering  this  phase  of  the  question,  some  thought 
should  be  given  to  the  possibility  that  if  the  State  exacts  the 
inheritance  tax  from  bequests  to  these  institutions,  it  may  take 
money  out  of  its  own  pocket,  for  the  reason  that  the  more  the 
State  depletes  the  fund  the  more  it  may  be  forced  to  contribute 
to  the  support  of  these  institutions.  Furthermore,  in  taxing 
such  funds  the  State  may  discourage  bequests  of  this  character, 
and  in  the  end  the  amount  collected  from  the  inheritance  tax 
upon  them  be  but  a  small  part  of  the  loss  of  public  revenue. 

But  there  is  another  side  to  this  question.  The  tax  is  imposed 
upon  the  theory  of  the  benefit  of  the  right  to  succession.  The 
immediate  need  of  the  State  to  the  tax-  may  be  greater  than  the 
indirect  benefit  of  having  the  estate  passed  to  a  charitable,  educa- 
tional or  religious  institution. 

In  addition  to  the  inheritance  tax,  the  State  of  Maryland  exacts 
from  executors  and  administrators  a  tax  of  10  per  cent,  of  the 
commissions  allowed  them  by  the  Orphans'  Court.  These  com- 
missions vary,  at  the  discretion  of  the  court,  from  2  per  cent,  to 
10  per  cent,  of  the  value  of  estates  of  $20,000  or  less.  If  the 
estate  is  valued  at  more  than  $20,000,  the  commission  cannot 
exceed  2  per  cent,  on  the  balance  over  $20,000.  This  commission 
on  the  amount  of  allowance  has  some  of  the  elements  of  an  in- 
heritance tax.  The  State  receipts  from  this  source  amounted  in 
1912  to  $63,223. 


BIBLIOGRAPHY. 

Reports  of  National  Tax  Association,  volume  6,  p.  283. 


Taxation — State  and  Local  Communities  317 


TAXATION  OF  STOCK  AND  BONDS  ISSUED  BY 
STATE  AND  LOCAL  COMMUNITIES. 

The  subject  of  taxation  of  the  securities,  stocks  and  bonds 
issued  by  States  and  local  communities  has  received  a  vast 
amount  of  attention  within  recent  years  with  satisfactory  results 
in  legislative  changes. 

The  fundamental  principle  was  laid  down  by  the  Supreme 
Court  of  the  United  States  in  Weston  vs.  Charleston, ^  which 
held  that  such  a  tax  on  public  debt  was  a  tax  on  the  power  of 
States,  counties  and  cities  to  borrow  money  and  an  interference 
with  a  governmental  function. 

A  tax,  too,  against  a  public  debt  is  a  tax  by  the  Government 
against  itself  to  pay  itself,  and,  as  has  been  aptly  put,  is  a  tax 
against  the  shadow  of  a  thing  which  public  policy  demands  shall 
be  exempt. 

At  the  first  conference  of  tax  officials  from  the  several  States, 
constituting  the  National  Tax  Association,  held  in  Columbus, 
Ohio,  in  1907,  this  question  of  exemption  of  public  obligations  of 
State,  counties  and  cities  received  consideration,  and  among  the 
first  resolutions  adopted  was  the  following: 

"Whereas,  The  United  States  Supreme  Court  truly  stated  that 
a  tax  on  public  debts  is  a  tax  on  the  power  of  States,  counties 
and  municipalities  to  borrow  money, 

''Resolved,  That  the  public  debts  of  all  States,  counties  and  mu- 
nicipalities should  everywhere  be  exempted  from  taxation." 

According  to  the  very  latest  reports,  the  following  States  ex- 
empt State  bonds  from  all  taxation : 

Alabama.  Minnesota. 

Arizona.  Mississippi. 

Arkansas.  Nevada. 

California.  New  York. 

Connecticut.  New  Jersey. 

Delaware.  New  Mexico. 

Georgia.  North  Carolina. 


12  Peters  449. 


318  Report  of  the  Commission 

Idaho.  Oklahoma. 

Indiana.  .  Pennsylvania. 

Kansas.  Rhode  Island. 

Louisiana.  South  Carolina. 

Maryland.  Utah. 

Maine.  Vermont. 

Massachusetts.  Virginia. 

Michigan.  Wyoming. 

In  addition  to  these  States,  public  bonds  are  virtually  exempted 
in  the  States  of  Washington  and  Montana  by  administrative  prac- 
tice, while  Ohio  will  vote  on  a  Constitutional  amendment  exempt- 
ing all  bonds  issued  by  the  State,  counties,  cities,  or  other  polit- 
ical subdivisions  of  the  State,  in  November,  1913.  This  was 
formerly  the  policy  of  this  State,  a  previous  similar  amendment 
having  been  adopted  by  a  vote  of  655,508  to  139,062,  but  the 
framers  of  the  Constitution  of  1912  omitted  this  provision  from 
the  Constitution,  and  consequently  action  was  required  again. 

According  to  some  students  of  this  question,  the  only  States 
which  have  any  State  debt  and  tax  their  own  bonds  in  the  hands 
of  their  residents  are  New  Hampshire,  Tennessee,  Iowa  and 
Texas,  and  in  only  one  of  these — namely,  Tennessee — is  the  State 
debt  over  $2,000,000.  In  this  connection,-  it  is  proper  to  add  that 
Tennessee  in  1903  passed  an  act  exempting  its  bonds  from  State 
taxation,  but  the  Supreme  Court  of  the  State  held  this  act  un- 
constitutional. 

Officials  from  Nebraska,  North  Carolina,  Oregon,  Vermont, 
Montana,  Colorado  and  Washington  express  the  opinion  that 
all  public  bonds  should  be  exempt  from  taxation. 

In  the  following  States  the  bonds,  stocks  and  securities  issued 
by  the  counties,  cities  and  other  political  subdivisions  are  exempt 
from  taxation: 

Alabama.  Mississippi. 

Arizona.  Nevada. 

Arkansas.  New  Jersey. 

California.  Georgia. 

Delaware.  Idaho. 

Maine.  Iowa. 

Minnesota.  Indiana. 

Michigan.  Kansas. 


Taxation — State  and  Local  Cokm unities 


319 


Oklahoma. 
South  Carolina. 
Utah. 
Wyoming. 

It  will  consequently  be  noticed  that  the  following  cities,  among 
many  others,  have  their  bonds  and  stocks  exempt  from  all  tax- 
ation : 


Louisiana. 
Massachusetts. 
New  York. 
New  Mexico. 


New  York. 

Buffalo. 

Rochester. 

Syracuse. 

Albany. 

Newark. 

Jersey  City. 

Cleveland. 

Cincinnati. 

Toledo. 

Columbus. 

Atlanta. 

Savannah. 

San  Francisco. 

Los  Angeles. 

Salt  Lake  City. 

Wilmington,  Del. 

Montgomery. 

Mobile. 

Detroit. 

New  Orleans. 


Boise. 

Indianapolis. 

Kansas  City,  Kan. 

Topeka. 

Grand  Rapids. 

Lansing. 

St.  Paul.    . 

Duluth. 

Des  Moines. 

Boston. 

Lowell. 

Cambridge. 

Springfield,  Mass. 

Oklahoma  City. 

Guthrie. 

Little  Rock. 

Phoenix. 

Cheyenne, 

Oakland. 

Sacramento. 


In  only  one  instance,  as  far  as  our  information  goes,  does  a 
State  tax  its  own  bonds  and  exempt  the  bonds  of  its  municipal- 
ities, and  that  state  is  Iowa. 

An  interesting  subject  for  determination  under  the  principle  of 
interstate  comity  is  the  exemption  of  the  public  debts  of  other 
States  held  by  residents  of  States  which  exempt  their  own  bonds. 
This  question  should  be  considered  by  conferences  of  taxation  in 
the  country. 


320  Report  of  the  Commission 

THE  CONDITION  IN  MARYLAND. 

There  is  no  general  statute  which  provides  that  bonds  or  stock 
issued  by  the  State  of  Maryland  should  be  exempt  from  tax- 
ation,- but  every  separate  act  in  the  last  20  years  which  has 
provided  for  a  loan  has  stipulated  that  such  stock  or  bonds 
should  be  exempt  from  all  State,  county  and  municipal  taxation. 

Prior  to  the  session  of  the  Legislature  of  Maryland  of  1908, 
with  the  exception  of  stock  issued  by  Baltimore  City,  it  was  the 
almost  universal  rule  of  the  Legislature  of  the  State  to  grant 
to  communities  the  right  to  issue  stock  or  bonds  free  from  all 
taxation  (State,  county  and  municipal);  but  in  the  session  of 
1908,  and  since  then,  a  number  of  issues  have  been  made  subject 
to  State  taxation.  It  was  only  at  the  last  two  sessions  that  the 
question  of  extra  territorial  exemption  has  received  any  consid- 
eration. For  instance,  does  it  lie  within  the  power  of  the  Legis- 
lature of  Maryland  by  a  special  act  to  authorize  the  County  Com- 
missioners of  Montgomery  County  to  issue  its  stock  in  payment 
of  a  debt,  and  to  provide  that  such  stock  shall  be  exempt  from 
taxation  in  Allegany  county?^    - 

Issues  of  stock  or  bonds  of  counties  and  municipalities  of 
Maryland  may  be  divided  as  regards  the  taxation  thereof  into 
six  groups,  viz : 

A.  Those  not  exempt  from  any  taxation. 

B.  Those  exempt  from  all  taxation,  county,  municipal 
and  State. 

C.  Those  exempt  from  all  county  and  municipal  tax- 
ation, but  subject  to  the  State  tax  by  direct  assess- 
ment against  the  holder. 

D.  Those  exempt  from  local  taxation  in  the  county  of 
issue,  but  subject  to  local  taxation  elsewhere  in  the 
State  (and  to  State  taxes  throughout  the  State)  by 
direct  assessment  against  the  holder. 


^See  Art.  31,  sections  112-113-114  Code  of  Public  General  Laws. 
sgee  Baltimore  vs.  Allegany  County — 99  Md.  1. 


Taxation — State  and  Local  Co m,m unities  321 

E.  Those  exempt  only  from  municipal  taxes  in  the  town 
of  issue,  but  taxable  for  county  and  State  purposes 
throughout  the  State  by  direct  assessment  against  the 
holders. 

F.  Those  exempt  from  local  taxation  in  the  locality  of 
issue,  but  subject  to  local  taxation  elsewhere  in  the 
State  by  direct  assessment  against  the  holder;  and 
subject  to  the  State  tax  at  the  source,  i.  e.,  by  deduc- 
tion thereof  from  the  interest  payable  on  the  stock. 

It  would  be  a  tremendous  task  to  classify  all  the  loans  issued 
by  the  communities  of  Maryland  into  their  proper  classes,  be- 
cause of  their  great  number ;  for  instance,  in  one  session — namely, 
that  of  1908 — thirty-four  separate  acts  were  passed  authorizing 
bond  issues. 

A  few  references,  however,  will  suffice  to  illustrate  the  differ- 
ent groupings. 

A.  These  acts  contaUi  no  reference  to  taxation. 

Salisbury  Loan;  Acts  1902,  ch.  463. 
Cumberland  Loan;  Acts  1910,  ch.  478. 
Thurmont  Loan;  Acts  1910,  ch.  9. 
Hagerstown  Loan;  Acts  1910,  ch.  528. 
Montgomery  County  Loan;  Acts  1912,  ch.  697. 
Montgomery  County  Loan;  Acts  1912,  ch.  65. 
Allegany  County  Loan;  Acts  1912,  ch.  74. 
Union  Bridge  Loan;  Acts  1912,  ch.  622. 
Thurmont  Loan;  Acts  1912,  ch.  629. 
Frostburg  Loan ;  Acts  1912.  ch.  730. 

B.  These  acts  provide  exemption  from  all  taxation. 

Carroll  County  Loan ;  Acts  1900,  ch.  242. 
Hyattsville  Loan;  Acts  1900,  ch.  216. 
Dorchester  County  Loan ;  Acts  1902,  ch.  206. 
La  Plata  Loan ;  Acts  1902,  ch.  629. 
Charles  County  Loan ;  Acts  1902,  ch.  44. 
Montgomery  County  Loan;  Acts  1904,  ch.  641. 


322  Report  of  the  Commission 

Rockville  Loan ;  Acts  1904,  ch.  228. 
Wicomico  County  Loan;  Acts  1904,  ch.  100. 
Garrett  County  Loan ;  Acts  1906,  ch.  788. 
Salisbury  Loan;  Acts  1906;  ch.  4661/2- 
Easton  Loan;  Acts  1910,  ch.  117. 
Dorchester  County  Loan;  Acts  1910,  ch.  486. 
Talbot  County  Loan;  Acts  1910,  ch.  545. 
La  Plata  Loan;  Acts  1912,  ch.  770. 
Easton  Loan;  Acts  1912,  ch.  747. 
Pocomoke  City  Loan;  Acts  1912,  ch.  164. 

C.  These  acts  authorise  exemption  from  all  county  and  munici- 
pal taxation  throughout  the  State. 

Allegany  County  Loan;  Acts  1902,  ch.  115. 
Kensington  Loan;  Acts  1902,  ch.  72. 
Somerset  County  Loan;  Acts  1902,  ch.  32. 
Anne  Arundel  County  Loan;  Acts  1906,  ch.  313. 
Denton  Loan;  Acts  1906,  ch.  332. 
Crisfield  Loan;  Acts  1906,  ch.  131. 
Centrevile  Loan ;  Acts  1906,  ch.  225. 
Annapolis  Loan;  Acts  1908,  ch.  345. 
Cecil  County  Loan;  Acts  1908,  ch.  734. 
Prince  George's  County  Loan;  Acts  1908,  ch.  112. 
Annapolis  Loan;  Acts  1910,  ch.  663. 
Kitzmillersville  Loan;  Acts  1910,  ch.  491. 
Ellicott  City  Loan;  Acts  1912,  ch.  340. 
Chestertown  Loan;  Acts  1910,  ch.  468. 
Betterton  Loan;  Acts  1910,  ch.  124. 
Oxford  Loan;  Acts  1910,  ch.  617. 
Hancock  Loan;  Acts  1910,  ch.  33. 
Berlin  Loan;  Acts  1910,  ch.  521. 
Calvert  County  Loan;  Acts  1912,  ch.  720. 
Preston  Loan;  Acts  1912,  ch.  702. 
Chestertown  Loan;  Acts  1912,  ch.  706. 
Hurlock  Loan;  Acts  1912,  ch.  771. 
Brunswick  Loan;  Acts  1912,  ch.  590. 
Betterton  Loan;  Acts  1912,  ch.  174. 
Princess  Anne  Loan;  Acts  1912,  ch.  562. 


Taxation — State  and  Local  Com-munities  323 

D.  "^These  acts  authorize  exemption  within  the  county  of  issue. 

Montgomery  County  Loan;  Acts  1910,  ch.  672. 
Talbot  County  Loan ;  Acts  1910,  ch.  108. 
Wicomico  County  Loan,  Acts  1910,  ch.  12. 
Baltimore  County  Loan;  Acts  1912,  ch.  345. 
Centreville  Loan;  Acts  1910,  ch.  77. 
Frederick  City  Loan;  Acts  1910,  ch.  48. 
Brunswick  Loan;  Acts  1910,  ch.  557. 
Queen  Anne's  Loan;  Acts  1910,  ch.  582. 
Church  Hill  Loan;  Acts  1910,  ch.  467. 
Ocean  City  Loan ;  Acts  1910,  ch.  397. 
Sudlersvilie  Loan ;  Acts  1912,  ch.  396. 
St.  Mary's  County  Loan;  Acts  1912,  ch.  209. 
Wicomico  Loan;  Acts  1912,  ch.  661. 
Annapolis  Loan;  Acts  1912,  ch.  118. 
Greensboro  Loan;  Acts  1912,  ch.  123. 
Ridgely  Loan;  Acts  1912,  ch.  578. 
Church  Hill  Loan;  Acts  1912,  ch.  811. 
Chestertown  Loan;  Acts  1912,  ch.  550. 
Dorchester  Loan;  Acts.  1912,  ch.  692. 
Vienna  Loan;  Acts  1912,  ch.  54. 
Frederick  County  Loan;  Acts  1912,  ch.  66. 
Centreville  Loan;  Acts  1912,  ch.  129. 
Queen  Anne's  County  Loan ;  Acts  1912,  ch.  769. 
Frederick  City  Loan;  Acts  1912,  ch.  39. 
Myersville  Loan ;  Acts  1912,  ch.  442. 
Frederick  County  Loan;  Acts  1912.  ch.  404. 
Hyattsville  Loan,  Acts  1912,  ch.  11. 


4The  Acts  of  1912,  ch.  99,  authorizing  a  bond  issue  by  the  City  of  Cam- 
bridge, provided  for  exemption  in  the  following  unusual  form: 

"Said  bonds  and  every  part  thereof  and  the  interest  thereon  being  ex- 
empt from  all  countv  and  municipal  taxation  in  Dorchester  County, 
whether  laid  directly  or  indirectly  in  the  hands  of  any  corporation  or 
individual  holder  thereof." 

Here  is  a  plain  effort  not  only  to  exempt  the  bonds  from  direct  local 
taxation  in  Dorchester  County,  but  also  to  exempt  the  shares  of  all 
banks  or  corporations  of  the  State  (holding  these  bonds)  held  by  resi- 
dents of  Dorchester  County,  to  the  extent  that  the  bonds  enter  into  the 
value  of  such  shares.  This  would  accord  a  privilege  to  these  bonds 
which  is  not  even  given  to  the  bonds  of  the  United  States  Government. 

Another  act  for  Dorchester  County  (1912,  ch.  104)  contains  a  similar 
clause. 


324  Report  of  hie  Commission 

E.  These  acts  authorise  exemption  within  the  city  or  tozvn  of 
issue. 

Kensington  Loan ;  Acts  1910,  ch.  240. 
Garrett  Park   (Montgomery  County)   Loan;  Acts  1910, 
ch.  366. 

F.  To  this  classification  belongs  only  the  stock  issued  by  the 
Mayor  and  City  Council  of  Baltimore. 

Investigation  shows  that  in  practice  the  only  public  obligations 
that  actually  pay  any  State  tax  are  those  in  classification  "F," 
or  where  the  State  tax  is  payable  through  the  City  Register  of 
Baltimore  on  Baltimore  City  Loans,  through  deduction  from  the 
interest,  because  its  issues  alone  require  payment  at  the  source. 

By  contract  between  the  City  of  Baltimore  and  the  taxable 
holders  of  its  stock,  the  State  tax,  as  to  practically  all  of  the  out- 
standing issues,  is  now  paid  directly  by  the  city  in  behalf  of  the 
holders. 

Even  where  the  obligations  of  the  counties  and  towns  of 
Maryland  arfe  legally  liable  to  State  and  local  taxation,  the 
liability  is  rarely  enforced.  Where  the  obligations  are  exempt 
from  local  taxation,  wholly  or  in  part,  but  subject  to  State  tax- 
ation, the  securities  as  shown  by  the  investigation  of  the  com- 
mission are  never  assessed  for  any  purposes.  This  is  due  to  the 
fact  that  the  holders — either  innocently  or  otherwise — treat  the 
local  exemptions  as  a  complete  relief,  or  that  the  assessors  are 
not  accurately  informed  and  likewise  extend  the  local  exemption 
so  as  to  cover  the  State  tax  as  well.  The  complicated  state  of  the 
law  furnishes  some  excuse  for  these  common  mistakes.  In  the 
reports  to  the  Commission,  returned  by  local  officials,  many  of 
the  issues  are  classed  as  exempt  from  all  taxation,  when  as  a 
matter  of  fact  they  are  not  exempt  from  State  taxation  under  the 
terms  of  the  enabling  act,  and  in  some  cases  not  even  exempt 
from  local  taxation  except  in  the  county  of  issue. 

It  is  evident  that  the  rule  to  be  applied  should  be  uniform 
throughout  the  State.  No  sound  reason  can  be  advanced  for  dis- 
criminating in  favor  of  given  localities.  All  bonds  of  cities  and 
counties  are  generically  alike.  Sound  policy  justifies  the  total 
exemption  of  all  public  obligations  from  direct  taxation.  The 
State  of  Maryland  has  long  recognized  this  by  exempting  her 


Taxation — State  and  Local  Communities  325 

own  obligations.  But  whatever  be  the  rule,  it  is  certain  that  it 
should  be  uniform  both  as  to  liability  to  taxation  and  method 
of  collection  of  the  tax. 

In  order  to  get  the  expression  of  county  and  municipal  offi- 
cials in  dififerent  parts  of  the  State,  the  Commission  asked  an 
expression  of  opinion  on  the  policy  of  exempting  from  taxation 
the  public  debt  of  local  communities.  The  opinions  of  these 
officials  and  the  reasons  assigned  for  the  same  were  a  surprise 
to  the  Commission.  Time  after  time  statements  were  made  that 
the  tax,  if  levied,  was  a  tax  which  the  borrower  himself  had  to 
pay  and  was  therefore  the  means  of  increasing  the  rate  of  in- 
terest or  depressing  the  selling  price.  A  few  officials  did  not 
answer  the  query.  The  only  county  officials  who  thought  that 
public  bonds  should  not  be  exempt  were  those  of  Howard  county,"' 
and  the  only  municipal  officials  who  thought  the  exemption 
should  not  be  granted  were  those  of  Rockville,  in  Montgomery 
county,^  and  Bladensburg,  in  Prince  George's  county." 

A  striking  instance  of  discrimination  appears  in  the  tax  against 
Baltimore  City  stock  levied  by  the  State  of  Maryland  and  col- 
lected by  the  State,  not  by  direct  assessment  against  the  holders, 
but  by  requiring  the  City  Register  to  deduct  the  tax,  at  the  source, 
from  the  interest  payments. 

It  is  to  the  advantage  of  Maryland  that  public  improvements 
in  its  metropolis  should  not  be  impeded,  but  under  the  present 
policy  the  State  imposes  a  penalty  on  Baltimore  City  for  pro- 
viding new  sewers,  new  schoolhouses,  electric  conduits,  increased 
water  supply,  public  buildings,  streets  and  parks,  all  of  which 
add  to  the  comfort  of  its  citizens  and  increase  the  taxable  basis 
from  which  State  revenue  is  derived. 

The  attitude  of  the  Legislature  toward  other  communities  is 
directly  opposite  to  this  position,  and  it  should  be  borne  in  mind 
that  if  the  need  of  the  tax  necessitates  the  law  that  the  aggregate 
of  the  taxes  received  from  all  other  communities,  counties,  cities 
and  towns  would  be  considerable. 


SHoward  County  has  no  debt. 

6Rockville's  bond  issue  is  exempt  from  all  taxation. 

TBladensburg  has  no  debt. 


326  Report  of  the  Commission 

The  State  tax  paid  on  its  stock  del)t  by  Baltimore  City  for  1912 
was  $68,781.82.  With  the  increase  in  the  State  rate  and  the  nor- 
mal increase  in  the  amount  of  bonded  indebtedness,  this  annual 
exaction  will  increase. 

In  the  following  ])ages  are  set  out  the  funded  debts  of  all 
the  counties  of  Maryland,  as  reported  to  the  Commission  by  the 
local  authorities,  and  in  another  compilation  the  debts  of  all 
municipalities  and  towns. 

The  information  furnished  by  the  local  authorities  to  this  Com- 
mission was  not  as  full  as  desired  as  to  whether  the  issues  were 
issues  providing  for  sinking  funds  or  whether  they  were  serial 
bond  issues.  The  serial  bond  issue  has  become  the  favorite 
method  of  local  financing,  and  is  advocated  by  nearly  all  officials 
having  in  charge  the  administration  of  local  affairs  in  different 
communities. 

The  compilations  should  prove  valuable  as  the  first  attempt,  as 
far  as  the  Commission  knows,  to  collect  in  comparative  form  the 
bonded  debts  of  the  local  communities  of  the  State. 


Taxation — State  and  Local  Communities  327 


BONDED  INDEBTEDNESS  OP  THE  STATE  OF  MARYLAND. 

September  30,  1912, 


Bonded  In- 
debtedness. 


Floating 
Debt. 


Sinking 
Fund. 


Exemption 

from 
Taxation. 


Maryland $13,028,095.63        None        $5,701,836.65 


All 


8B0NDED  INDEBTEDNESS  OF  THE  COUNTIES  OF  MARYLAND. 
(Information  as  supplied  by  local  authorities.) 
January  1,  1913. 


Baltimore  City.  . . 
Baltimore  County 
Calvert  County. . . 

Caroline 

Carroll 

Cecil 

Charles 


Dorchester , 

Frederick 

Garrett 

Harford 

Howard 

Kent 

Montgomery.  . . . 
Prince  George's. 
Queen  Anne's. . , 

Somerset 

St.  Mary's 

Talbot 

Washington .... 

Wicomico 

Worcester 


Bonded  In- 
debtedness, 


Floating 
Debt. 


Sinking 
Fund. 


Allegany $130,000.00 

Anne  Arundel 369,666.67 


71,294,382.95 
None 

4,000.00 

33,500.00 

20,000.00 

129,000.00 

37,000.00 

82,900.00 
382,700.00 
50,000.00 
13,000.00 
None 
22,000.00! 
138,400.00' 
146,800.001 
40,000.00 
91,000.00! 
22,000.00 
40,500.00 
54,600.00! 
49,000.00 
66,000.00 


42,220.18i 

None 
None 

* 


Serial  Loar 
$51,559.73 

24,470,359.97 

Serial  Loan 

None 

24,336.33 

None 


20,000.00 


775.00 

Serial  Loar 
Serial  Loan 


None 

'Serial  Loar 
None       1        51,300.00 

*  i       None 
1,500.00 Serial  Loar 

*  21,694.88: 
None  7,600.00 

*  I        54,600.00 

*  j  * 

*  i        12,000.00 


Extent  of 
Exemption 

from 
Taxation. 


*Not  reported. 

sCompiled  from  special  report  of  county  officials. 

^See  ante  discussion  under  "F." 


>>  to 
^< 

3 
O    M 

o  t. 
O 


X52 

S    3 
Oh   O 

.d    CO 


a 

o     . 

S.I 


All 

All 

9 

Taxable 

All 
All 
All 
All 
All 
Part 
exempt 
All 
All 
All 

All 
All 
All 
All 
All 

All 

All 
All 


Yes 
Yes 

Yes 

Yes 
Yes 
Yes 

Yes 

Yes 
Yes 
Yes 

No 
Yes 
Yes 
Yes 
Yes 
Yes 

Yes 

Yes 
Yes 


328 


Report  of  the  Commission 


BONDED  INDEBTEDNESS  OF  MUNICIPALITIES. 
(Information  as  supplied  by  local  officials.) 
January  1,  1913. 


q     c  o 

Bonded 
Indebted- 
ness. 

Floating 
Debt. 

Sinking 
Fund. 

Extent  of 

Exemption 

from 

Taxation. 

Opinion    of    1 
Officials     As 
Whether  Mu 
pal  Bonds  Sh 
Be  Exempt. 

Allegany  Co. 

Cumberland 

$879,900.00 

$35,700.00 

All 

Frostburg 

55,000.00 

27,187.45 

All 

Yes 

Lonaconiug 

None 

Midland 

None 
8,600.00 

12,500.00 

591.88 

All 

Westernport   .... 

Yes 

Anne  Arundel  Co. 

Annapolis 

260,000.00 

3,000.00 

11,961.04 

All 

Baltimore  City. 

(See  tabula 

tion  of  coun 

ty    indebted 

ness.) 

Baltimore  Co. 

(No  incorpo 

rated  cities. 

towns  or  v 

illages.) 

Calvert  Co. 

Chesapeake  Beach 

None 

Caroline  Co. 

Denton 

8.000.00 

All 

Yes 

Federalsburg.  .  . . 

None 

1,500.00 

Goldsboro 

* 

Hillsboro 

* 

Greensboro    

* 

Preston 

* 
33,500.00 

All 

Ridgely 

Carroll  Co. 

Hampstead 

None 

Manchester 

* 
(Net) 

Mt.  Airy 

$1,700.00 

All 
All  but 

Yes 

New  Windsor 

22,500.00 

400.00 

State 

Yes 

Sykesville 

5,000.00 

4,900.00 

All 

Yes 

Taneytown 

12,200.00 

6,000.00 

* 

All 

Yes 

Union  Bridge.  . . . 

4.500.00 

None 

All 

Yes 

Westminster 

25,000.00 

* 

* 

*No  report. 


I 


Taxation — State  and  Local  Communities  32y 

BONDED  INDEBTEDNESS  OF  MUNICIPALITIES— Oonfrnwed. 
(Information  as  supplied  by  local  officials.) 
January  1,  1913. 


P 


Cecil  Co. 

Cecilton 

Cliarlestown 

ChesapeaKe  City. 

Elkton 

Nortli  East 

Perry  ville 

Port  Deposit.  .  . . 
Rising  Sun 


Bonded 
Indebted- 
ness. 


Cltarles  Co. 
La  Plata. 


Borcliester  Co. 

Cambridge 

East  New  Market 

Hurlock 

Secretary 

Vienna 

Frederick  Co. 

Frederick 

Brunswick 

Middletown 

Emmitsburg. .  . . 


Thurmont .  . 
Walkerville. 
Myersville .  . 


Garrett  Co. 

Deer  Park 

Friendsville 

Grantsville 

Kitzmiller 

Loch  Lynn  H'ghts 
Oakland    


Floating 
Debt. 


Sinking 
Fund. 


Extent  of 

Exemption 

frona 

Taxation. 


"3  O  .J,  -o 

"  -"a 
°  CO 
hJ    CO   3  ^      . 

°  ,„  !-  -a  e 

CO    Oi 


.2o 


5  -r,  o  pq  H 


o 


None 
* 

1,000.00 
None 

i.DOO.OO 
None 
14,000.00 
None 


4,800.00 


71,000.00 
None 
None 
None 


673,500.00 
32,500.00 
15,500.00 
None 

18,000.00 
* 

None 


None 
None 
None 

None 
None 
54.000.00 


2,200.00 
500.00 


Serial  Loai 
5,17'7.78 


None 


4,179.62 


All 
All 
All 

All* 

Part 
exempt 


25,000.00 
37,868.92 
None 
790.34 

2,500.00 


None 


522.21 


All  Except 
126,285.69        94,000 


2,851.34 
1,700.00 


All 

All 

Exempt 
in  County 


6,538.901 


All 


Yes 
Yes 
Yes 

Yes 
Yes 


Yes 
Yes 
Yes 


Yes 


Yes 

Yes 
Yes 
Yes 
Yes 


*No  report. 


330 


Report  of  the  Commission 


BONDED  INDEBTEDNESS  OF  MUNICIPALITIES— Coniinwed. 
(Information   as  supplied  by  local  officials.) 
January  1,  1913. 


Bonded 
Indebted- 
ness. 


Floating 
Debt. 


Sinking 
Fund. 


Extent  of 

Exemption 

from 

Taxation. 


ZS  9  .A  "O 

iJ  m  3  rj     . 
o       1,^  S 

o  ~  "S  CQ  H 

.S  e  g  -3  ij 
o 


aW 


Harford  Co. 

Aberdeen 

Bel  Air 

Havre  de  Grace. 

Howard  Co. 

Ellicott  City.  .. 


Kent  Co. 

Betterton . . . . 
Qhestertown: 

Galena 

Rock  Hall.  .. 
Still  Pond... 
Millington.  .  . 


Montgomery  Co. 

Brookville 

Gaithersburg.  . . 
Garrett  Park.  . . 

Glen  Echo 

Kensington 

Laytonsville.  . . . 

Poolesville 

Rockville 

Somerset 

Takoma  Park . . . 

Prince  George's  Co. 
Bladensburg. . .  . 

Hyattsville 

Laurel , 

Mt.  Rainier 

Upper  Marlboro. 

Queen  Anne's  Co. 

Centerville 

Church  Hill...  . 

Sudlersville 

Queenstown 


21,500.00 

None 

81,000.00 


1,500.00 


1,600.00 
40,000.00 
None 
None 
None 
None 


None 
None 

None 

* 

3.450.00 
None 

25,500.00! 

2,400.00 

56,000.00, 


57,000.00 
82,500.00 
None 
None 


48,000.00 
None 
None 
None 


3,500.00 
4,000.00 
4,000.00 


7,000.00 
1,000.00 


None 
None 
None 


9,600.00 
5,300.00 


4,320.56 
15,706.71 


500.00 


None 
200.00 
128.95 


23,147.44 


All 
All 


All 
All 


Yes 


Yes 


Yes 
Yes 


AH 
All 


All 
All 
All 


All 


All 


Yes 
Yes 
Yes 
Yes 


No 
Yes 
Yes 


No 
Yes 


Yes 
Yes 

Yes 


*No  report. 


Taxation — State  and  Local  Communities 


331 


BONDED  INDEBTEDNESS  OP  MUNICIPALITIES— CO/ifrnwed. 

(Information  as  supplied  by  local  officials.) 

January  1,  1913. 


Bonded 
Indebted- 
ness. 


Floating 
Debt. 


Sinking 
Fund. 


Extent  of 

Exemption 

from 

Taxation. 


o      So 
o       .    '^ 


.2  -G  aJ  CQ  W 

.S  «E  g  d  <^ 
aOf>  ftfQ 


&t.  Mary's  Co. 
Leonardtown . 

Somerset   Co. 


Crisfield 

Princess  Anne. 


Talhot  Co. 

Easton 

Oxford 

St.  Michael. 
Trappe 


Washington  Co. 


Boonsboro. . . 
Clear  Spring. 
Hagerstown . . 

Hancock 

Keedysville.  . 
Sharpsburg. . 
Smithsburg.  . 
Williamsport. 
Funkstown.  . 


'mcomico  Co. 
Delmar.  . .  . 
Pittsville. . 
Salisbury.  . 
Sharptown. 


Worcester  Co. 

Berlin 

Ocean  City. . . . 
Pocomoke  City. 
Snow  Hill 


None 


46,000.00 
lY.oOO.OO 


72,000.00 


None 


None 

104,000.00 
ixone 
None 
None 
None 
3,000.00 


None 

* 

46,000.00 


40,000.00 
30,000.00 
50,000.00 
41,000.00 


2,000.00 


1,200.00 


5,793.58 


None 


1,000.00 


3,300.0C 
5,000.00 
5i200.0C 


From  local 
All 


All 
All 


All 


All 


5,000.00 


None 
3,951.74 


All 


All 

All 

All 

Part 

exempt 


Yes 
Yes 


Yes 
Yes 


Not 
Considered 


Yes 


Yes 

Yes 
Yes 


Yes 
Yes 


*No  report. 


332  Report  of  the  Commission 


BIBLIOGRAPHY. 

First  vol.  International  Tax  Association  Report. 

Report  of  the  New  Hampshire  Tax  Commission,  1912. 

Report  of  Virginia  Tax  Commission,  1912. 

Arthur  B.  Chapin,  address  before  National  Municipal  League,  Provi- 
dence—1907. 

Report  of  Treasurer  of  Massachusetts — 1905.     Mass.  Public  Documents. 

Plehn — "Exemption  of  Public  Obligations." 
"Public  Policy,"  1902. 

Report  of  Frank  G.  Pierce,  League  of  Iowa  Municipalities — Oct.,  1907. 


Taxation  of  Mineral  Deposits  333 


TAXATION  OF  MINERAL  DEPOSITS. 

Maryland  is  unique  in  its  territory  and  varies  greatly  in 
character  of  its  lands  and  soils,  being  divided  by  the  Chesapeake 
Bay  and  its  tributaries  into  two  parts,  designated  the  Eastern 
Shore  and  the  Western  Shore.  The  counties  of  the  Eastern 
Shore  are  nine  in  number  and,  with  the  exception  of  Cecil,  the 
northernmost  one,  the  elevation  in  no  case  is  greater  than  eighty 
feet.  On  the  Western  Shore  a  condition  directly  opposite  pre- 
vails, as  the  ground  rises  gradually  but  rapidly,  and  within  eighty 
miles  of  tidewater  there  is  an  elevation  of  three  thousand  feet  at 
Mt.  Quirauk,  in  Washington  .County,  with  nvmierous  adjacent  and 
rich  valleys  running  in  a  general  north  and  south  direction.  The 
highest  elevation  of  the  State  is  thirty-seven  hundred  feet  at 
Backbone  Mountain,  in  Garrett  County. 

With  such  a  difference  in  lands,  there  is  a  great  diversity  in 
products,  as  the  lands  are  particularly  adapted  for  particular 
purposes. 

The  State  is  not  abundantly  rich  in  deposits  of  minerals, 
although  the  returns  from  some  products  are  relatively  valuable 
compared  with  the  products  of  other  industries.  The  wealth  of 
minerals  lies  in  a  few  counties  of  the  State  only,  because  there 
are  no  deposits,  not  even  stone,  in  any  of  the  lower  tidewater 
counties.  However,  stone  is  otherwise  well  distributed  and  there 
are  quarries  in  several  counties;  indeed,  it  is  doubtful  if  the  stone 
industry  has  reached  anything  like  its  capacity  in  the  State. 

Deposits  of  coal  are  found  in  only  two  of  the  twenty-three 
counties,  namely,  Allegany  and  Garrett.  These  counties  occupy 
a  strip  of  land  lying  between  Pennsylvania  on  the  north  and  West 
Virginia  on  the  south.  These  deposits  are  found  in  the  following- 
coal  basins : 

George's  Creek  Basin. 
Upper  Potomac  Basin. 
Castleman  Basin. 
Lower  Youghiogheny  Basin. 
Upper  Youghiogheny  Basin. 


334  Report  of  the  Commission 

These  basins  also  extend  considerably  into  Pennsylvania  and 
West  Virginia. 

Since  the  Maryland  Geological  Survey  Department  was  estab- 
lished by  provisions  of  an  act  passed  in  1896,  the  mineral  output 
of  the  State  has  greatly  increased. 

In  1897  the  total  value  of  all  mineral  products  was  $5,475,729, 
and  the  following  table,  taken  from  the  last  report  of  the  depart- 
ment, shows  the  value  of  the  different  products  for  the  last  ten 
years. 


Taxation  of  ]\Iiner,al  Deposits 


335 


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336  Report  of  the  Commission 

As  appears  from  the  table,  the  coal  industry  is  the  most 
important. 

Taxation  of  Coal. 

The  method  of  assessing  the  coal  mines  is  left  to  the  local 
appraisers. 

In  the  special  report  to  this  Commission  a  few  facts  stand  out 
sharply : 

That  the  surface  of  mines  is  often  used  for  farming 
purposes. 

That  there  has  never  been  an  appraisement  of  the  mines 
by  any  persons  other  than  appraisers  of  other  jiroperty. 

No  assessor  versed  in  coal  values  and  with  a  knowledge  of 
mines  has  valued  them  for  purposes  of  taxation. 

That  the  product  of  the  mine  is  not  taxed  as  personal 
property.  (By  Article  81,  Section  4,  Public  General  Laws, 
the  product  of  the  mines  of  Maryland  Corporations  is  not 
assessed  as  such,  provided  the  shares  of  stock  are  assessed.) 

That  the  mines  are  practically  owned  or  operated  by  cor- 
porations. 

The  acreage  of  the  known  mines  is  not  ascertainable,  and 
consequently  the  ratio  of  mining  lands  to  total  area  of  the 
two  counties  is  not  known. 

The  value  of  the  coal  product  mined  and  reported  is 
between  six  and  eight  millions  annually. 

The  ownership  is  varied.  In  some  cases,  the  owner  of  the 
mine  is  also  the  operator;  or  there  are  mineral  grants  to  one 
person  or  corporation,  while  the  surface  remains  in  another,  and 
the  owner  of  the  mineral  right  is  compensated  on  a  royalty  basis. 
Or  again,  the  owner  or  operator  may  be  an  individual,  a  domestic 
corporation,  or  a  foreign  corporation.  In  all  three  of  these  cases 
the  manner  of  taxation  is  entirely  different. 

If  the  owner  and  operator  is  an  individual  or  firm,  the  value  of 
the  mine  as  assessed  by  the  appraiser  determines  the  limit  of  his 
liability,  because  there  is  no  tax  against  the  product  or  against 
the  mined  coal  as  personal  property. 


Taxation  of  Mineral  Deposits  337 

\\'hen  the  mine  is  operated  by  a  foreign  or  domestic  corpora- 
tion, the  same  tax  is  levied  against  the  land  as  though  owned  by 
an  individual  and  with  the  same  possibility  of  faulty  assessment. 

If  the  corporation  is  a  foreign  corporation,  the  State  demands 
a  franchise  tax  of  $25.00  for  the  first  $50,000  of  capital  employed 
in  the  State,  and  a  contribution  in  like  amount  as  it  demands  for 
other  corporations  over  $50,000;  in  addition  the  shares  of  resi- 
dent holders  are  taxed  against  such  holders  at  the  security  rate 
if  they  can  be  found,  and  if  such  shares  actually  pay  a  dividend. 

If  the  operator  happens  to  be  a  domestic  corporation,  the  value 
of  the  shares  is  determined  by  the  State  Tax  Commissioner.  The 
law  defines  in  detail  the  nature  of  the  reports  of  such  corporation. 
It  shall  set  forth  in  full  the  assets  of  the  corporation  and  liabili- 
ties, and  in  no  case  is  the  aggregate  or  gross  assessment  of  the 
shares  to  be  less  than  the  value  of  the  real  and  tangible  personal 
property  of  the  corporation  located  in  the  State.  From  such 
gross  assessment  is  deducted  the  assessed  value  of  the  real  estate, 
and  the  net  assessment  of  each  share  is  obtained  by  dividing  the 
aggregate  net  assessment  by  the  number  of  shares. 

Nearly  all  the  owners  and  operators  are  domestic  corporations. 

The  aggregate  gross  valuation  of  their  shares  fixed  by  the 
State  Tax  Commissioner  for  1911  was  $8,699,105.  Deductingthe 
$4,269,557  real  estate  assessed  from  this,  there  remains  $4,427,548 
to  represent  the  value  of  the  taxable  investments  (i.e.. shares  of 
other  Maryland  corporations  owned  by  the  companies)  and  the 
tangible  personal  property  of  the  several  corporations,  including 
machinery,  \i\e  stock,  rolling  stock,  mineral  products,  etc. 

On  the  net  assessed  value  of  the  shares  the  corporation  pays 
the  State  tax^  directly  to  the  State  Comptroller,  and  local  taxes 
on  behalf  of  the  holders  to  the  different  sub-divisions  of  the  State 
where  the  respective  shareholders  reside.  Local  taxes  on  the 
shares  of  non-residents  of  the  State  are  paid  under  a  special  pro- 
vision of  law-  to  the  locality  where  the  principal  works  are  situ- 
ated. State  and  local  taxes  on  real  estate  are  paid  to  the  local 
collector  where  the  land  is  situated. 


iln  1911  22  cents  per  $100.- 

2P.  G.  L.,  Article  81,  Section  150. 


338  Report  of  the  Commission 

Coal  in  the  mine  is  of  a  very  uncertain  value.  It  may  be  free 
of  slate  and  bone,  but  the  thickness  of  the  vein,  accessibility, 
existence  of  "faults"  are  all  determining  and  qualifying  factors 
of  value.     Any  square  foot  method  of  valuation  is  faulty.-^ 

The  Legislature  of  Maryland  attempted  in  1872^  to  impose  a 
tax  of  two  cents  a  ton  on  all  coal  mined  in  the  State  and  trans- 
ported to  any  place  in  the  State  or  elsewhere  for  sale,  and  the 
validity  of  the  act  was  questioned  and  determined  adversely  in 
the  case  of  State  vs.  Cumberland  and  Pennsylvania  Railroad 
Company.^  The  act  was  held  unconstitutional  by  a  mere 
majority,  four  judges  holding  the  act  unconstitutional  and  three 
being  of  a  contrary  opinion.  The  main  point  in  the  case  was 
whether  the  act  was  repugnant  to  the  provisions  of  the  Constitu- 
tion of  the  United  States,  which  declares  that  "Congress  shall 
have  power  to  regulate  commerce  with  foreign  nations  and  among 
the  several  States." 

But  there  were  other  considerations  in  the  case.  Maryland's 
method  of  taxation  has  always  been  by  the  ad  valorem  method, 
and  the  Court,  after  deciding  the  question  of  interstate  commerce, 
says : 

"What,  then,  is  the  character  of  the  tax  imposed  by  the  act  in 
question?  It  is,  beyond  all  doubt,  a  direct  and  specific  tax  upon 
■coal,  and  therefore  a  tax  upon  property.  It  is  not  assessed  with 
reference  to  any  uniform  value  of  the  coal  nor  with  reference 
and  in  conformity  to  any  rate  of  taxation  imposed  upon  the  other 
property  of  the  State.  It  is  therefore  a  specific,  arbitrary  tax 
levied  for  the  support  of  the  government  on  a  part  of  the  personal 
property  of  the  State  without  regard  to  value,  uniformity  or 
equality.  Upon  the  same  principle  that  this  tax  of  two  cents  per 
ton  is  attempted  to  be  imposed,  if  legal,  the  State  could  impose 
fifty  cents  or  even  a  dollar  per  ton  on  all  the  coal  mined  and 
transported. 

"Now  the  capital  stock  of  the  mining  companies  of  the  State 
is  liable  to  taxation  according  to  a  fixed  and. certain  rate;  and 
the  stock  being  the  representation  of  the  whole  property  of  the 
corporation,  the  payment  of  the  tax  on  the  capital  stock  exempts 


^See  Lehigh  &  Wilkes-Barre  Coal  Co.'s  case,  225  Pa.,  272. 

4Acts  of  1872,  Chapter  274. 

540  Md.,  22. 

See  Phila.  &  Reading  R.  R.  Co.  vs.  Penn,  15  Wall,  232. 


Taxation  of  Mineral  Deposits  339 

from  taxation  all  the  property  both  real  and  personal  of  the 
company.  And  although  the  State  may  elect  to  tax  either  the- 
capital  stock  or  the  real  and  personal  property  of  the 
company,  yet  it  cannot  tax  both;  and  if  it  elects  to  tax  the  real 
and  personal  property,  and  not  the  stock,  such  property  must  be 
assessed  according  to  the  same  equal  and  uniform  rate  in  pro- 
portion to  its  value  as  all  other  property  in  the  State,  whether 
owned  by  individuals  or  corporations.  It  is  not  competent  for  the 
Legislature  to  discriminate  as  between  different  species  of  prop- 
erty, and  to  tax  one  by  some  rule  and  some  by  another.  All  must 
bear  the  burden  alike;  for  if  it  were  otherwise,  it  would  be  im- 
possible to  observe  the  rule,  which  requires  that  every  person 
holding  property  therein  should  contribute  his  proportion  of 
public  taxes  for  the  support  of  government,  according  to  his 
actual  worth  in  real  or  personal  property.  The  protection 
afforded  by  the  rule  consists  in  the  equality  and  uniformity 
required  whereby  one  person  shall  not  be  taxed  more  or  less  than 
another,  because  he  may  happen  to  own  a  different  species  of 
property  from  that  owned  by  the  other.  Hence  the  Legislature 
could  not  do  what  was  attempted  to  be  done  by  the  act  under 
consideration;  for  although  the  State  might  elect  to  tax  the  prop- 
erty of  the  coal  companies,  yet  the  entire  tax  exacted  from  them 
could  not  be  in  the  shape  of  a  special  tax  laid  exclusively  upon 
one  species  of  personal  property — namely,  their  coal  mined  for 
transportation.  Such  legislation  most  clearly  violates  the  act 
of  the  Bill  of  Rights  to  which  we  have  referred,  and  so 
declaring,  we  shall  affirm  the  judgment  of  the  court  below." 

The  act  was  held  unconstitutional,  and  since  then  there  have 
been  no  attempts  to  tax  the  product  of  the  mines  at  a  specific  rate. 

The  best  authorities  on  taxation  in  the  United  States  are 
agreed  that  a  production  tax  is  the  proper  method  of  reaching 
mineral  deposits. 

Lawson  Purdy  in  his  article  on  ''A  Model  System  of  Tax- 
ation"6  advocates  the  taxation  of  the  surface  land  in  the  same 
manner  as  the  surrounding  land  of  the  counties,  to  be  paid  to 
the  local  communities;  and  a  production  tax  against  the 
product  for  the  use  of  the  State. 


^State  and  Local  Taxation  :    Addresses  before  International  Tax  Associ- 
ation, Vol.  1,  p.  54. 


340  Report  of  the  Commission 

Whether  the  tax  should  be  for  the  State  or  local  communi- 
ties is  of  importance.  Regulations  of  one  county  may  dis- 
criminate against  an  adjoining  county;  the  care  of  the  mines 
and  inspection  are  State  expenses ;  and  again,  fatalities  of  the 
mines  always  necessitate  State  aid. 

It  would  appear  that  in  the  province  of  Ontario.  Canada, 
a  royalty  is  paid  to  the  province,  and  a  similar  method  of 
taxation  prevails  in  Quebec,  New  Brunswick,  Nova  Scotia 
and  British  Columbia.''' 

The  Tax  Commission  of  West  Virginia  of  1902.  appointed 
for  the  purpose  of  studying  taxation  in  that  State,  in  its 
report  to  the  Legislature  of  1903  recommended  the  levying  of 
a  production  tax  of  one-third  of  one  cent  per  ton.  The  recom- 
mendation was  not  accepted  by  the  Legislature,  however,  but 
the  outcome  of  the  entire  agitation,  which  lasted  several 
years,  was  a  tax  against  the  "leasehold"  to  be  determined  at 
its  true  or  actual  value  in  addition  to  the  general  property 
tax  against  the  land.^ 

The  Tax  Commission  of  Minnesota  in  1909  also  recom- 
mended a  production  tax.  Extended  consideration  of  the 
subject  may  be  disposed  of  by  quoting  briefly  from  Frank  L. 
McVey,  Chairman  of  the  Minnesota  Tax  Commission  :^ 

"An  examination  of  the  reports  of  taxing  officers  shows 
that  little  attention  has  been  given  to  the  taxation  of  mineral 
lands  in  the  United  States.  Here  and  there  some  differentia- 
tion has  been  made  from  the  principle  of  the  general  property 
tax,  but  in  the  main  the  same  system  of  taxation  applies  to 
mineral  properties  as  to  houses  and  lots  and  agricultural 
lands.     *     *     *     * 

"For  purposes  of  classification  the  taxation  of  minerals  as 
now  carried  on  may  be  grouped  under: 

"1.  General  Property  Tax. 

"2.  Annual  Output  Tax. 

"3.  General  Property  and  Gross  Earnings  Tax. 


"Taxation  of  Mineral  Resonrces  in  Canada.  O.  D.  Skelton — 2  vol. 
International  Tax  Association  Report,  p.  385. 

^See  Taxation  of  Coal,  Oil  and  Gas  in  West  Virginia.  International  Tax 
Association — 2  vol.,  p.  395 — T.  C.  Townsend. 

^International  Tax  Association  Report,  2  vol.,  p.  411. 


Taxation  of  Mineral  Deposits  341 

"4.  General  Property  and  Net  Earnings  Tax. 

"5.  Tax  on  Royalties. 

"6.  Tonnage  Tax. 

"To  each  classification  belongs : 

"1.  General  Property  Tax.^*^ 

"California,  Ohio,  Georgia,  New  Hampshire,  Texas, 
Michigan,  Tennessee,  Missouri,  North  Carolina, 
Virginia,  New  Mexico,  Minnesota,  West  Virginia, 
Nebraska,  North  and  South  Dakota,  Washington 
and  Alabama. 

"2.  Annual  Output  Tax. 

"Arizona,  Nevada,  British  Columbia,  Mexico,  On- 
tario. 

"3.  General  Property  and  Gross  Earnings  Tax. 
"Colorado,  South  Carolina. 

"4,  General  Property  and  Net  Earnings  Tax. 
"Utah,  Montana. 

"5.  Royalty  Tax. 

"Great  Britain. 

"6.  Tonnage  Tax. 

"Michigan,  Minnesota.''^ 


^^Maryland  also  belongs  to  this  class. 

i^It  has  not  been  thought  necessary  for  our  purpose  to  amend  this  tabu- 
lation to  show  changes  of  methods  of  taxing  mines  since  the  publication  of 
this  article. 

A   SUGGESTION   FROM   THE   PENNSYLVANIA   TAX 

COMMISSION. 

Pennsylvania  had  a  joint  Legislative  committee  to  study 
taxation  and  to  report  to  the  Legislature  of  1911,  and  which 
was  continued  with  like  powers  until  1913. 

The  commission  considered  the  taxation  of  coal  and  sug- 
gested that  as  Pennsylvania  had  a  monopoly  of  anthracite 
coal  the  Legislature  should  pass  an  act  laying  a  State  tax 
thereon  of  2l^  per  cent,  of  the  valuation  thereof  when  pre- 


342  Report  of  the  Commission 

pared  for  market.  The  act  was  not  passed  in  the  session  of 
1911,  but  the  recommendation  of  the  commission  has  been 
renewed  to  the  Legislature  of  Pennsylvania. ^^ 

The  consideration  of  the  commission  was  also  directed 
to  the  taxation  of  bituminous  coal.  Bituminous  coal  of 
Pennsylvania  enters  into  competition  with  the  coal  of  West 
Virginia,  Ohio  and  Maryland,  and  any  tax  against  the 
products  of  the  mines  of  that  State  was  considered  as  mili- 
tating against  that  State  and  placing  it  in  an  unfair  position 
with  the  products  of  the  adjoining  States. 

The  joint  committee  recommended  a  conference  of  com- 
missioners from  the  States  affected,  and  the  Legislature 
adopted  a  joint  resolutions^  providing  for  the  appointment  of 
such  a  commission  to  discuss  the  subject  and  to  make  recom- 
mendations for  concerted  action. 

The  facts  controlling  the  recommendations  of  the  Pennsvl- 
vania  committee  are  analogous  to  those  in  Maryland,  and 
Maryland  can  therefore  hardly  afiford  to  do  otherwise  than 
to  urge  the  Governor  of  this  State  to  co-operate  with  Penn- 
sylvania when  requested  by  its  Governor  to  do  so. 


OTHER   PRODUCTS. 

Other  mineral  products  are  not  so  valuable.  Clay  and  clay 
products  derive  their  value  from  manufacture,  and  stone,  the  third 
in  value,  can  be  taxed  in  a  fair  manner  by  a  central  State 
system.  At  the  present  time  there  are  quarries  in  Mont- 
gomery county  of  great  value  mined  by  individuals,  and 
investigation  shows  that  there  is  no  attempt  to  value  the 
product  in  the  quarries  nor  to  apply  any  method  of  assessing  the 
land  in  a  scientific  manner. 


i^House  bill,  passed  by  Senate  June  3,  1913. 
iSResolution,  June  19,  1911,  P.  L.  1044. 


Taxation  of  Woodlands  343 

TAXATION  OF  WOODLANDS. 

The  development  of  the  relation  of  taxation  and  forestry 
has  as  yet  received  no  consideration  in  Maryland,  although  it  is 
conceded  that  the  relation  between  the  two  is  very  marked.  In 
the  beginning,  however,  it  must  be  clearly  understood  that  legisla- 
tion on  this  subject  should  never  reach  the  point  that  owners  of 
forests  should  not  pay  their  just  share  of  taxation,  and  as  long 
as  the  general  property  tax  remains  all  that  is  needed  is  simple 
justice  and  modification  of  the  law  to  be  developed  by  a  broad 
administrative  policy. 

That  the  question  is  of  importance  in  Maryland  appears  from 
the  statement  of  the  large  area  of  wooded  land,  because  approxi- 
mately 35  per  cent,  of  the  total  territory  is  in  forest.  Moreover, 
much  of  the  territory  is  only  adapted  to  forestry,  and  the  present 
laws  are  a  bar  to  far-reaching  development. 

The  following  table  shows  the  area  of  the  standing  timber  of 
each  county  in  Maryland  based  on  all  species  of  trees  10  inches 
and    over   in    diameter    measured    at   breast   heights,    4%    feet 

from  the  ground : 

Per  Cent. 
Wooded      .      of  County 

County.  Acres.  Wooded. 

Allegany  163,650  51 

Anne  Arundel  92,647  34 

Baltimore   103,525  26 

Calvert    62,390  45 

Caroline    63.142  30 

Carroll    39.292  13 

Cecil    55,642  25 

Charles    147.840  50 

Dorchester    140,742  38 

Frederick    86,481  22 

Garrett   273,357  64 

Harford    81,872  29 

Howard   37.130  24 

Kent 33.755  17 

Montgomery    68,851  28 

Prince  George's   127.200  41 

Queen  Anne's   59,279  25 

St.  Mary's   119,080  SO 

Somerset    68.371  25 

Talbot    45.812  29 

Washington   79,516  27 

Wicomico   111,513  47     - 

Worcester    134,627  43 

Totals    2,195,714  35 

(From  Report  of  Maryland  State  Board  of  Forestry,  1912.  page  34.) 


344  Report  of  the  Commission 

In  the  discussion  of  tax  methods  under  each  county,  taxed 
value  of  wooded  areas  is  referred  to  and  the  general  criticism 
may  truly  be  said  to  be  that  the  manner  of  assessing  in  each 
county  is  crude  and  there  is  no  effort  made  to  tax  this  class  of 
property  according  to  its  actual  worth. 

Many  of  the  counties  fail  to  classify  this  class  of  property  at 
all,  and  very  few  provide  for  taxing  at  a  separate  valuation  the 
wooded  parts  of  tracts.  Indeed,  such  method  of  classification  is 
the  exception  rather  than  the  rule.  Some  of  the  contrasts  made 
between  sales  value  and  assessment  are  those  of  woodland. 

Farms  are  more  valuable  if  a  fair  portion  is  in  woods. 

In  Wicomico  County  the  claim  is  made  on  the  part  of  the 
County  Commissioners  that  wooded  areas  are  assessed  by  persons 
familiar  with  the  value  of  standing  timber. 

In  1905  Massachusetts  had  a  committee  to  "consider  the  laws 
relative  to  the  taxation  of  forest  lands,"  and  within  recent  years 
the  legislatures  of  fifteen  States  have  adopted  special  legislation 
on  forests.    These  States  are : 

Maine,  Alabama, 

New  Hampshire,  Michigan, 

Vermont,  Wisconsin,  - 

Massachusetts,  Iowa, 

Rhode  Island,  Nebraska, 

Connecticut,  North  Dakota, 

New  York,  Washington. 
Pennsylvania, 

The  Michigan  law  was  passed  in  1911 ;  the  New  York  laws  in 
1912,  and  the  Pennsylvania  laws  in  1913.1 

Nearly  all  the  other  States  tax  forest  lands  under  the  general 
property  tax  in  exactly  the  same  manner  as  other  lands. 

Four  States,  viz :  Illinois,  Kansas,  Minnesota  and  Wyoming, 
allow  a  bounty  on  growth,  but  these  concessions  deserve  no  place 
in  a  discussion  on  taxation ;  neither  are  those  provisions  of  the 
laws  of  Massachusetts  and  Vermont,  which  provide  for  the 
offering  of  annual  prizes  to  encourage  planting  and  cultivation. 

Prof.  Frederick  R.  Fairchild,  of  the  Department  of  Economics 
at  Yale,  is  probably  one  of  the  foremost  advocates  of  a  modifica- 

lActs  Nos.  269,  270  and  284,  approved  June  5,  1913. 


Taxation  of  Woodlands  345 

tion  of  present  general  property  tax  as  relates  to  forests,  and  in 
the  reports  of  the  National  Conservation  Commission  he  discusses 
fully  every  phase  of  the  question. 

The  fourth  National  Conservation  Congress  in  October,  1912, 
adopted  a  resolution  drawing  attention  to  the  subject  of  taxation 
of  forests,  which,  in  part,  is  as  follows : 

"Holding  that  conservative  forest  management  and  re-foresta- 
tion  by  private  owners  are  very  generally  discouraged  or  pre- 
vented by  our  methods  of  forest  taxation,  we  recommend  State 
legislation  to  secure  the  most  moderate  taxation  of  forest  land 
consistent  with  justice  and  the  taxation  of  the  forest  crop  upon 
such  land  only  when  the  crop  is  harvested  and  returns  revenue 
wherewith  to  pay  the  tax." 

Epitome  of  the  laws-  concerning  taxation  of  zvooded  la)ids  in 
those  States  having  a  special  law.^ 

Alabama  permits  the  owner  of  land  which  has  been  denuded 
of  trees,  or  the  assessed  value  of  which  does  not  exceed  $5  per 
acre,  to  make  a  contract  with  the  commission  of  forestry  agreeing 
to  plant  or  grow  and  maintain  timber  trees  on  such  land  for  ten 
years  under  the  direction  of  the  commission,  in  return  for  which 
the  land  is  exempt  from  taxation  for  a  period  of  10  years. 

The  Connecticut  law  applies  to  any  land,  not  exceeding  in 
value  $25  per  acre,  and  not  previously  woodland,  which  the 
owner  plants  with  certain  specified  kinds  of  timber  trees.  After 
the  trees  have  grown  to  the  average  height  of  6  feet  the  owner 
may  obtain  exemption  from  taxation  for  a  period  of  20  years. 

The  Maine  law  applies  to  "cleared  land  or  lands  from  which 
the  primitive  forest  has  been  removed,"  which  the  owner  plant.s 
or  sets  apart  for  the  growth  of  forest  trees.  After  the  trees 
have  been  properly  maintained  for  3  years  the  owner  may  obtain 
exemption  from  taxation  for  20  years. 

The  Massachusetts  law  applies  to  plantations  of  certain  speci- 
fied kinds  of  timber  trees,  upon  land  which  at  the  time  of  planting 
was  not  "woodland  or  sprout  land,  or  land  containing  more  than 
600  standing  trees  to  the  acre,"  and  not  worth  more  than  $10  per 


-Second  volume  of  the  Report  of  the  National  Conservation  Commission 
(1909),  page  588. 
31913  laws  have  not  been  digested. 


346  Report  of  the  Commission 

acre.  After  the  trees  have  grown  in  height  2  feet  on  the  average, 
the  owner  is  entitled  to  exemption  from  taxation  for  10  years. 

The  Rhode  Island  law  applies  to  plantations  of  certain  speci- 
fied kinds  of  timber  trees  upon  land  worth  not  more  than  $25 
per  acre.  Exemption  from  taxation  is  granted  for  a  period  of 
15  years  from  the  time  of  planting,  provided  the  land  is 
planted  and  managed  under  a  forest-working  plan  approved  by 
the  State  commissioner  of  forestry.  Not  more  than  300  acres 
owned  by  a  single  person  or  corporation  may  be  thus  exempted 
from  taxation. 

The  Vermont  law  allows  to  uncultivated  lands,  planted  with 
timber  or  forest  trees  and  cared  for  under  the  direction  of  the 
forestry  commissioner,  exemption  from  taxation  for  10  years 
beginning  April  1  of  the  second  year  after  the  planting. 

The  Wisconsin  law  applies  to  lands  not  within  two  miles  of 
any  incorporated  city  or  village  except  upon  written  approval 
of  the  State  forester,  and  not  worth  more  than  $10  per  acre. 
If  the  owner  of  such  lands  sets  apart  any  portion,  not  exceeding 
40  acres,  for  forest  culture,  and  plants  it  with  timber  or  forest 
trees  and  properly  maintains  the  trees,  he  is  entitled  to  exemption 
from  taxation  for  a  period  of  30  years  from  the  time  of  planting. 
Wisconsin  also  provides  that  when  tree  belts  of  certain  specified 
character  are  planted  and  properly  maintained  the  land  on  which 
they  are  planted  shall  be  exempt  from  taxation  until  the  trees 
reach  the  height  of  12  feet,  after  which  the  owner  is  entitled  to 
an  annual  bounty  of  $2  per  acre,  which  bounty  is  deducted  from 
the  taxes  assessed  on  the  land. 

Iowa  has  an  exemption  law  somewhat  different  from  the  others. 
The  Iowa  statute  provides  for  the  setting  apart  of  so-called 
forest  or  fruit  tree  reservations  in  private  ownership,  with  certain 
restrictions  as  to  area  of  the  reservation,  and  number,  species 
and  care  of  the  trees.  Such  reservations  are  assessed  for  taxation 
at  $1  per  acre  for  a  period  of  8  years  from  the  time  of  planting. 
Moreover,  in  all  cases  where  trees  are  planted  the  assessed  value 
of  the  land  is  not  to  be  increased  on  account  of  the  value  of 
such  trees. 

Nebraska  has  a  statute  providing  that  "the  increased  value  of 
lands  by  reason  of  live  fences  and  forest  trees  grown  and  culti- 
vated thereon  shall  not  be  taken  into  account  in  the  assessment 


Taxation  of  Woodlands  347 

thereof."  This  law  carries  out  a  provision  of  the  State  consti- 
tution expressly  permitting  such  legislation. 

Washington  exempts  from  taxation  "all  fruit  trees,  except 
nursery  stock,  and  forest  trees  artificially  grown." 

New  Hampshire  allows  to  the  owners  of  land  planted  with 
timber  or  forest  trees  the  following  rebate  of  taxes  for  a  period 
of  30  years :  For  the  first  10  years  after  planting,  a  rebate  of  90 
per  cent,  of  all  taxes  assessed  upon  the  land;  for  the  second  10 
years,  a  rebate  of  80  per  cent.,  and  for  the  third  period  a  rebate 
of  50  per  cent. 

North  Dakota  grants  a  bounty  of  $3  per  acre  for  tracts  of 
prairie  land  of  1  to  10  acres  planted  with  any  kind  of  forest  trees 
and  properly  maintained.  This  bounty  may  commence  1  year 
after  planting,  and  is  deducted  annually  from  the  farm  taxes 
for  a  period  of  5  years.  A  bounty  is  also. granted  for  forest 
trees  planted  in  hedge  rows  as  boundary  lines.  The  bounty  is 
$2  for  80  rods  of  hedge  row,  paid  annually  for  a  period  of  five 
years. 

The  1913  Legislature  of  Pennsylvania  has  enacted  three  laws 
which  are  calculated  to  not  only  relieve  the  owners  of  forest 
reserves  from  the  burden  of  taxation  during  the  time  that  such 
reserves  are  unproductive  of  revenue,  but  also  to  allow  the 
localities  in  which  the  reserves  are  situated  to  share  in  the 
additional  values  incident  to  the  growth  of  the  timber.  The 
acts  practically  exempt  forest  reserves  from  general  property 
taxation,  but  exact  a  tax  of  10  per  cent,  of  the  value  of  the 
timber  at  the  time  it  is  cut.  The  timber  is  to  be  appraised  for  the 
purpose  of  the  tax  immediately  before  cutting.  The  tax  is  to 
be  distributed  to  the  several  funds  of  the  taxing  district  in  which 
the  reserve  is  situated  in  practically  the  same  proportion  as  though 
it  had  been  collected  by  general  property  taxation. 

New  York  and  Michigan  also  provide  for  a  system  of  separa- 
tion of  land  and  trees  for  purposes  of  taxation,  the  land  to  be 
assessed  at  a  low  valuation  and  the  trees  taxed  when-  cut  at  a  per- 
centage of  value. 


348  Report  of  the  Commission 

BIBLIOGRAPHY. 

Present  State  of  Forest  Tax  Legislation.     Fairchild :  American  Forestry, 
October,  1912. 

Analysis  and  Summary  of  Modern  Opinions  on  Taxation  of  Our  Wood- 
lands and  Forest.     H.  S.  Drinker  (1912). 

Taxation  of  Tinihcrlands  in   the   United  States.     Fairchild:  2nd  volume. 
International  Tax  Association  Report,  page  69. 

Ta.mtion  of  Forest  Lands.     A.  C.  Shaw :    2nd  volume.     International  Tax 
Association  Report,  page  83. 

Forest    Taxation    and    Conservation    as    Practiced    in    Canada.      Fernow; 
2nd  volume.    International  Tax  Association  Report,  page  93. 

Taxation  of  Forests.     Issued  by  the  Society  for  the  Protection  of  New 
Hampshire  Forests,  containing  the  following: 

(a)  Principles  Underlying  Forest  Taxation.  By  Dr.  B.  E.  Fernow, 
Dean  of  the  Faculty  of  Forestry,  University  of  Toronto,  and 
formerly  for  many  years  at  the  head  of  the  United  States 
Department  of  Forestry. 

(b)  Forest  Taxation.  By  Prof.  Frederick  R.  Fairchild,  of  Yale 
University. 

(c)  Practical  Application  of  Taxes  to  Forests.  By  Prof.  Charles 
J.    Bullock,   of   Harvard    University. 

(d)  Discussion  by — 

Alfred  Gaskill,  State  Forester,  New  Jersey. 

F.  W.  Rane,  State  Forester,  Massachusetts. 

E.   C.   Hirst,  State  Forester,   New  Hampshire. 

J.  H.  Foster,  Professor  of  Forestry,  New  Hampshire  State 
College. 

Warren  Tripp,  President  New  Hampshire  Pine  Lumbermen's 
Association. 

Oscar  Foss,  timberland  owner,  and  others. 

William  B.  Fellows,  Secretary  New  Hampshire  Tax  Com- 
mission. 

W.  R.  Brown,  of  the  Berlin  Mills  Company,_  President  New 
Hampshire  Timberland  Owners'  Association. 

Forest  Taxation.     Report  of  California  Special  Tax  Commission   (1906). 
Report  of  Massachusetts  Tax  Commission   (1909). 


Licenses  349 


LICENSES. 


License  receipts  embrace  a  considerable  portion  of  the  total 
revenue  of  Maryland,  and  the  provisions  of  the  present  laws, 
with  few  exceptions,  have  been  on  the  statute  books  for  years. 

The  first  license  fee  exacted  was  the  marriage  license 
enacted  by  the  Legislature  in  1777,i  and  the  fee  was  thirty 
shillings  current  money.  This  was  followed  by  the  license  on 
billiard  tables  in  1780,^  the  ferry  licenses  in  1781,3  the  license 
on  hawkers  and  peddlers  in  1784,*  and  the  spirituous  liquor 
license  in  1787.^^'  Innumerable  acts  followed  in  rapid  succes- 
sion for  years,  and  it  is  significant  that  the  development  of  the 
license  system  aided  greatly  in  doing  away  with  any  general 
property  tax,  because  up  to  1841  a  property  tax  for  State 
purposes  was  seldom  imposed.  Up  to  this  period  of  1841 
nearly  all  revenues  were  raised  indirectly ;  the  State's  holdings 
in  investments  were  large  and  profitable,  and  expenses  of  gov- 
ernment were  small. ^ 

The  period  of  indirect  taxation  developed  among  others  the 
broker's  license  in  1819,  the  "Retailer  of  Dry  Goods"  license  in 
1820,"  and  the  traders'  license  in  1831.8  The  act,  passed  in  the 
year  last  referred  to.  apportioned  the  tax  to  the  amount  of 
stock  of  goods  and  merchandise  on  hand  at  the  principal 
season  of  the  year,  and  has  continued  practically  the  same 
to  the  present  time. 

A  comprehensive  study  of  business  taxes  and  Hcenses  is  made 
by  Professor  Plehn  in  "Taxation  and  Revenue  Systems,"^  with 
tabulations  showing  the  licenses  and  rates  in  the  several 
States. 


^Chapter  12,  Section  13. 

^Chapter  8. 

^Chapter  21. 

^Chapter  7. 

■''Chapter  26. 

"Hanna  Financial  History  of  Maryland,  Chapter  3. 

'See  Brown  vs.  Maryland— 12  Wheat.  419. 

^Chapter  262. 

^U.  S.  Census  Publication  "Wealth,  Debt  and  Taxation"  (190/)  p.  638. 


350  Report  of  the  Commission 

The  range  of  subjects -of  license  taxes  is  very  extensive. 

He  says,  in  part: 

"The  States  of  Alabama,  Florida,  Georgia,  Kentucky, 
Louisiana,  Maryland,  Mississippi,  Missouri,  North  Carolina, 
Pennsylvania,  Tennessee,  Texas,  Virginia,  and  West  Vir- 
ginia— in  short,  all  the  Southern  States  except  South  Carolina 
(which  gives  the  revenues  from  a  similar  system  to  the 
counties) — have  an  extensive  system  of  State  license  taxes 
which  amounts  to  a  complete  or  nearly  complete  excise 
system,  supplementing  the  State  general  property  tax  and  in 
part  taking  its  place.  In  all  the  other  States  these  taxes 
appear  only  sporadically  as  State  taxes,  being  left  almost  en- 
tirely to  the  municipalities. 

"In  general,  these  taxes  are  levied  under  what  the  courts 
have  called  the  police  or  regulative  power,  rather  than  under 
taxing  power  of  the  government.  But  in  many  instances, 
especially  in  the  above  mentioned  States,  they  have  devel- 
oped to  such  a  degree  that  it  is  impossible  to  distinguish  them 
economically  from  true  taxes. 

"The  character  of  these  taxes  is  such  as  practically  to  defy 
classification.  The  motives,  too,  under  which  they  are  levied 
are  mixed.  Many  of  them,  such  as  the  tax  on  liquor  dealers, 
games,  and  amusements,  are  partly  regulative  and  partly 
sumptuary;  that  is,  they  are  levied  in  the  first  instance  to 
restrict  and  control  the  taxed  industry,  but  the  rates  are  often 
determined  by  the  fact  that  the  enjoyment  or  use  of  these 
things  is  evidence  of  an  ability  to  pay  taxes.  Another  group, 
such  as  the  taxes  on  itinerant  vendors,  peddlers,  auctioneers, 
etc.,  seems  to  be  dictated  by  the  idea  that  these  compete,  in 
an  irregular  way,  with  established  industries  which  pay  the 
regular  taxes.  Still  another  group,  like  the  taxes  on  lawyers, 
abstract  companies,  commission  merchants,  agents,  brokers, 
etc.,  seems  to  be  designed  to  reach  occupations  which,  while 
affording  good  incomes,  do  not  require  the  use  of  much,  if 
any,  taxable  property. 

"As  one  of  these  motives  which  gives  character  to  the  taxes 
is  rarely  found  in  any  case  unmixed  with  the  others,  classifica- 
tion along  these  lines  would  be  more  or  less  arbitrary  and 
largely  a  matter  of  opinion.     It  is  probably  on  this  account 


Licenses  351 

that  in  the  more  advanced  of  the  general  State  license  laws 
the  attempt  to  classify  the  taxes  has  been  abandoned  and  a 
simple  alphabetical  list  given. 

"Inasmuch  as  these  taxes,  where  extensively  used,  are  care- 
fully fitted  into  and  adjusted  to  the  other  existing  taxes  in 
the  general  system  of  each  State,  there  are  a  number  of 
apparent  gaps  which  cannot  be  accounted  for  without  refer- 
ence to  the  other  taxes. 

"These  taxes  are  occasionally  in  lieu  of  all  other  taxes." 

Professor  Plehn  has  188  different  classifications. i^ 

The  Maryland  system  of  levying  a  license  on  traders  for 
the  privilege  of  doing  business  is  not  general  throughout  the 
country,  but  may  be  said  to  be  peculiar  to  the  Southern 
States.  It  follows,  however,  a  custom  in  vogue  in  many  Eu- 
ropean cities.  Instead  of  charging  a  license  for  the  right  to  do 
business  based  on  amount  of  stock,  some  communities  have  adopted 
a  license  charge  based  on  the  volume  of  business  transacted 
annually.     Each  method  of  licensing  has  merit  and  its  advocates. 

In  Philadelphia  the  latter  method  prevails,  and  the  rate  on 
gross  sales  to  retailers  is  $1.00  per  $1,000,  to  wholesalers  50 
cents  per  $1,000,  and  to  exchange  and  boards  of  trade  25  cents 
per  $1,000,  and  the  entire  return  is  State  revenue.  St.  Louis 
has  a  special  tax  rate  levied  on  merchandise  of  merchants  and 
manufacturers  for  the  State's  interest,  and  a  city  license  of 
$1.00  per  $1,000  on  gross  sales.  The  Maryland  license  varies 
from  $6.00  to  $150.00,  according  to  stock  in  trade  at  the  prin- 
cipal season  of  the  year,  the  former  price  being  against  female 
traders  when  stock  of  goods  is  less  than  $500.00,  and  the 
maximum  fee  of  $150.00  being  against  merchants  having  stock 
in  excess  of  $40,000. 

It  would  seem  as  though  the  privilege  which  requires  the 
license  is  hardly  sufificient  to  justify  the  State  in  requiring 
a  statement  from  all  of  its  merchants  as  to  the  gross  sales, 
while  the  license  based  on  stock  in  trade  is  predicated  on  the 
tangible  personal  property,  which  has  to  be  ascertained  in  any 
method  of  direct  property  tax. 

^^For  rates,  etc..  see  pp.  639-42  inclusive   (note  9). 


352 


Report  of  the  Commission 


TRADERS'    LICENSES,'    ISSUED    BY    THE    CLERKS-   OF  THE  COURTS  FOR  THE 
YEAR'  ENDING  30TH  NOVEMBER,  1912. 

AGGREGATE  RECEIPTS  FROM  TRADERS'  LICENSES. 


County. 


Allegany. 
AnneAr'l 
Bait.  City 
Bait.  Co.. 
Calvert . . 
Caroline  . 
Carroll . . . 

Cecil 

Charles  . . 
Dorc'ster 


Stock  Less  Than 


o 

o 

•  o 


578 


3329 
311 


158 


o 
o 


o 


o 
o 

o 


169 


47 

178 
34 

187 

26 

62 

100, 

166 

8 

84 

22 


Fredericki]    ^63^     31 


Garrett . 

Harford  . 
Howard. . 

Kent ! 

Montg:'ry 

Pr.  Geo's. 

Q'n  Anne 

Somerset  i 

St.Mary's 

Talbot.  ..' 

Wash'ton' 

Wicomico 

Worc'st'r 

1 1 

Lic'seFee 

Total. 


I 


73 
21 


168 


203 


126 
149 

$12 

(5527 
)      60 


9 
•     1 

126 
64 

126 

134 
9 

112 
21 
93 

173 

1 

452j 
21; 
14 

$15 

12265 
I     36 


58 
18 

252: 

371 
17' 
14 
23 
26 
13 
29 

«■] 

25 
17 
12 
33 
20 
21 
14 
22 
22 
45 
15 
14 

$18! 

817i  i 
111 


48 
12 
152 
20 
11 
27 
39 
13 
17 
16 

49 

13 
1 

25 

9 

12 

21 

5 

22 

8 

16 

13 

36 

11 

12 

$22 
607 


26 

9 

102 

7 

2 

14 

32 

5 

9 


13 

52 
3 


20 
6 
6 


21 
10 

15' 
3 

20 

17 
3 
9 
5 
6 
6 

21 

6 

2 

$30 

350 


o 

o 
o 

o 
t-t 


n 

$40 
127 


12 

7 
1 

76 
5 
1 

13 
9 
2 


8 
2 

13 
2 


1 

10 
7 
3 


$50 

191 
1 


6 
1 

48 
1 


2 

3 

40 


30 
1 


$65 
93 


OS 


—  al  : 

"-"-"as- 


73 


68 


$100 
50 


$125 
28 


$150 
85 


261 

i  130 
I  32 

4474 
550 


p 


o 
H 


10 

64 

80 

12 

53 

99 
35 
23 
14 

72 

47 

2 

4 

129 

12 

19 


5 

186 

175 

59 

$6 

(6466 
'/  81 


0<  A  S 


ea 


1063 

(  359 
)  67 

8832 

962 

93 

185 

374 

300 

144 

298 

J  545 

I  76 

)  152 

1  37 

279 

142 

193 

214 

335 

185 

277 

138 

732 

758 

369 

251 


J  16680 
/   180 


$14,776.25 
4,707.50 

103, 948^90 
9,398.00 
1,270.00 
3,056.00 
6,816.01 
3,739.06 
2,022.50 
4,212.77 

8,910.50 
2,706.75 

3,779.00 
1,680.75 
3,533.75 

3,359.50 

not 
reported. 

2,561.44 
3,642.42 
1,942.00 
3,408.38 
9,562.76 

4,565.50 

not 
reported. 


$338,234.39 


(')     Licenses  are  required  May  1st. 

(-)     From  reports  of  clerks;  no  investigation  or  audit  made  by  this  commission. 

{')  The  fiscal  year  of  the  clerks  is  from  December  to  30th  November,  and  the  fiscal  year 
of  Comptroller  is  1st  October  to  30th  September,  so  no  attempt  has  been  made  to  reconcile 
discrepancies. 

(*)  Owing  to  nature  of  report  to  this  commission  from  some  clerks,  licenses  for  amount 
of  stock  not  exceeding  $1,000  and  $1,500  were  included  with  in  the  latter;  so  also  with  stock  of 
$8,000  and  $10,000. 


Licenses  353 

Margins  of  profits  in  different  classes  of  business  would 
seem  to  require  a  differentiation  of  the  charge  and  a  more 
elaborate  system  than  the  stock-in-trade  method. 

On  the  opposite  page  is  set  out  the  license  receipts  for  the 
State  for  the  last  fiscal  year,  which  netted  the  State  the  sum 
of  $989,311.69.  Consequently,  of  the  total  revenue  of  the 
State  of  $5,108,660.32  19  per  cent,  was  license  contribution. 
The  heaviest  license  amounts  are  traders'  and  liquor  licenses. 

TRADERS'  LICENSES. 

A  custom  has  been  brought  to  the  attention  of  the  Com- 
mission which  deserves  some  consideration. 

It  appears  that  the  State  Comptroller  sends  to  each  clerk, 
before  the  first  of  May,  which  is  the  beginning  of  the  license 
period,  a  number  of  licenses  of  each  classification  and  at  the 
end  of  each  month  the  several  clerks  of  the  courts  have  to 
account  to  that  department,  report  the  number  of  licenses  sold 
and  return  those  not  disposed  of.  The  Comptroller  sends  to 
clerks  the  licenses  for  the  remaining  portion  of  the  year  each 
month,  and  the  clerk  reports  the  sale  of  such  fractional 
licenses  and  returns  those  not  sold.  The  price  of  the  licenses, 
though,  is  apportioned  each  month. 

All  licenses  for  traders  are  required  to  be  issued  before  the 
31st  of  May,  and  a  full  year  is  charged  for  them  at  that  time. 
If  an  applicant  starting  a  new  business  requires  a  license,  it  is 
very  proper  that  he  should  pay  for  the  fractional  part  only  of 
the  year  he  is  in  business.  But  if  the  trader  neglects  to  apply 
for  his  license  and  is  continually  in  business  the  State  loses. 
Most  of  the  failures  of  applicants  are  intentional,  because  each 

(°)  j  178  I.  indicates  that  178  were  issued  for  the  full  year  and  34  for  fractional  parts  of 
I    34  *    the  year,  allowance  being-  made  for  expired  months. 

(")  This  account  is  subject  to  a  5'~'(  commission  to  the  clerk,  except  Clerk  of  the  Court 
of  Common  Pleas  of  Baltimore  City,  whose  commission  is  1'"^ ,  passed  to  fee  account  from 
which  expenses  of  office  constitutional  salary  of  clerk  are  paid  and  balance,  if  any,  sent  to 
State  Comptroller. 

V)  Clerk  of  Common  Pleas  Court  of  Baltimore  City  reported  $10,504.29  in  1912  as  de- 
linquent licenses,  but  which  were  actually  fines  imposed  by  the  judge  of  the  Criminal  Court 
and  Grand  Jury  of  Baltimore  City  for  failure  of  trades  to  obtain  licenses  by  first  of  May, 
when  business  was  conducted  without  interruption. 

C)  Clerk  of  Court  of  Common  Pleas,  Baltimore,  reports  interest  on  daily  balances 
passed  to  fee  account.     No  report  on  this  from  other  clerks. 

(')     Amount  retained  by  clerk  of  Harford  County  from  report  is  in  excess  of  S'^'c. 

('")     Clerk  of  Talbot  County  reports  that  the  amount  is  not  subject  to  S'^f  commission. 

(")  In  addition  each  applicant  pays  $1.10  on  each  license— 50c.  for  the  use  of  clerk,  50c., 
to  the  sheriff,  10c.  affidavit,  passed  to  fee  account,  to  be  accounted  for  by  him. 


354  Report  of  the  Commission 


STATE'S  RECEIPTS  FROM  LICENSES  FOR  THE  FISCAL 
YEAR  1912,  AS  REPORTED  BY  THE  COMPTROLLER  OF 
THE  STATE. 

Auctioneers  $3,704  75 

Tax  or  License  on  Insurance  Companies*..  126,434  38 

Billiard  Table 29,650  78 

Brokers  28,659  46 

Cigarette 14,467  56 

Carroll  County  Fishing 25  65 

Delinquent  10,504  29 

Exhibition    5,546  10 

Fishery — Chesapeake  Bay 454  88 

Gaugers 99  00 

Gunners    35  63 

Gypsy    47  50 

Hawkers  and  Peddlers 2,425  71 

High  Liquor— Baltimore  City 1,485,242  82 

Live  Stock  Dealers 146  52 

Motor   Vehicles 60,000  00 

Ordinary 24,742  95 

Oyster  House 6,254  23 

Oyster   Canners,   Packers   and   Commission 

Merchants    4,294  50 

Oyster  Measurers. . . '. 166  25 

Purse  Net . 200  00 

Race  and  Fishery ■           3  80 

Stevedore 235  14 

Traders  203,898  61 

Traders'   Liquor 57,031  22 

To  Dredge  for  Oysters 19,972  81 

To  Sell  Commercial  Fertilizers 10,650  00 

Tong  and  Scrape 9,222  70 

$2,104,117  24 

Deductions — 

Return  of  Baltimore  City  License $1,113,932  11 

Return  of  Calvert  County  License 760  00 

Return  of  Washington  County  License...  113  44 

: $1,114,805  55 

Net  return  of  licenses  to  the  State.  ..  $989,311  69 


*This   item   is   more  properly  a  return   from  corporations,   but   the 
State  has  always  treated  this  as  a  license  fee. 


Licenses  355 

month's  delay  means  one-twelfth  saving  on  the  license.  Of 
course,  such  a  method  is  unfair  to  those  individuals  who  are 
paying  the  full  quota.  In  Baltimore  City  this  delay  was  the 
subject  of  contest  in  1912,  and  the  persons  were  reported  to 
the  State's  Attorney  and  indicted  by  the  Grand  Jury.  The 
cases  were  disposed  of  by  the  Judge  sitting  in  the  Criminal 
Court,  who  released  the  offenders  upon  their  promise  to  pay 
the  amount  of  the  proportionate  parts  of  the  elapsed  months. 
This  item  aggregated  in  1912  $10,504.29,  or  an  amount  equal 
to  10  per  cent,  of  the  total  issuance  of  $103,948.90. 

The  investigation  of  conditions  in  the  counties  by  the  Com- 
mission shows  a  similar  condition  to  exist  and  some  change 
has  been  asked  by  several  county  clerks. 

FEMALE  TRADERS'  LICENSES. 

Investigation  has  also  been  directed  to  issuance  of  female 
trader's  licenses  where  the  amount  of  stock  carried  by  traders 
is  less  than  $500. 

In  Baltimore  City  there  were  issued  in  1912  8,832  licenses 
to  traders  of  all  classes  and  classifications.  Of  this  number 
4,474,  or  50  per  cent.,  were  issued  to  females  upon  oath  that 
the  amount  of  stock  was  less  than  $500.  In  Baltimore  County 
the  total  number  of  licenses  of  all  kinds  issued  was  962.  Of 
this  number  550,  or  57.6  per  cent.,  were  issued  to  females. 

The  Commission  has  no  means  of  saying  whether  or  not 
such  proportion  is  wholly  accurate,  but  investigation  shows  that 
the  privilege  has  generally  been  abused  throughout  the  whole 
State.  Either  the  law  whereby  this  concession  is  allowed  is 
wrong  in  theory,  or  the  enforcement  of  it  should  not  be  left 
to  the  applicant.  The  smallest  charge  for  license  is  $12.00  for 
stock  less  than  $1,000.00,  while  the  charge  for  female  license 
for  stock  less  than  $500.00  is  $6.00. 


356  Report  of  the  Commission 

OTHER  TRADERS'  LICENSES. 

The  investigation  by  the  Commission  also  demonstrates  that 
the  Hcense  carried  by  some  traders  is  for  an  amount  far  less 
than  actually  owned. 

The  only  licenses  issued  for  stock  in  excess  of  $40,000  are : 

Allegany  County 6 

Baltimore  City 73 

Carroll  County 2 

Washington  County 1 

Wicomico  County 3 

This  Commission  has  received  no  reports  on  this  line  except 
in  a  few  communities ;  in  those  the  investigation  showed  that 
merchants  were  not  carrying  licenses  commensurate  with  stock 
in  trade. 

The  table  of  traders'  licenses  set  out  on  page  eight  hasi 
been  compiled  from  reports  of  Clerks  of  Courts  to  this  Com- 
mission. The  aggregates  are  not  in  accord  with  the  report  of 
the  State  Comptroller. 

One  reason  of  the  discrepancy  is  the  difference  of  dates  of 
beginning  of  fiscal  years ;  the  Comptroller's  is  from  October  to 
September,  and  Clerks'  from  December  to  November;  and  other 
reasons  may  exist  on  account  of  difference  of  forms,  etc. 

INSPECTION   OF  STOCK  FOR  PURPOSE  OF  DETER- 
MINING AMOUNT  OF  LICENSES. 

Our  license  system  allows  the  trader  to  determine  his  annual 
charge.  Of  course,  there  is  no  denial  that  he  is  the  best  equipped 
and  in  many  cases  he  has  fully  met  his  obligation,  but  as  long  as 
human  nature  as  it  is  and  the  license  must  be  paid,  strict  com- 
pliance of  the  law  should  be  required. 

That  trader  who  thinks  that  he  is  conscientious  in  stating  a 
small  stock  and  pays  an  amount  of  license  too  small  because  his 


Licenses  357 

taxes  are  already  high  is  unfair  to  the  honest  appHcant.  No 
private  business  would  be  run  in  any  way  that  would  allow  one 
party  to  be  the  sole  judge  of  payments. 

LIQUOR  LICENSES. 

Investigation  of  liquor  licenses  has  extended  no  further  than 
the  State's  interest  in  the  return. 

In  ten  counties  of  the  State  there  are  no  liquor  licenses  of 
any  kind.  In  some  others  licenses  are  limited  to  small  commu- 
nities. 

The  licenses  are  governed  by  local  laws.  The  table  set  out 
on  a  preceding  page  shows  the  amount  of  payment  to  the  State 
and  gives  other  information. 

There  has  been  no  reason  presented  why  only  the  State's 
interest  in  liquor  licenses  is  forwarded  to  the  State  Comptroller 
in  all  communities  except  Baltimore  City  and  Calvert  County. 
From  these  two  communities  the  aggregate  amount  of  licenses 
is  forwarded  and  the  share  of  the  local  communities  is  returned 
(three-fourths  in  Baltimore  City  and  four-fifths  in  Calvert 
County). 

The  only  explanation  is  the  length  of  the  custom,  and  is  one 
of  the  anomalies  found  in  our  investigation. 

The  only  way  that  injustice  by  this  method  could  be  done  is 
apparently  in  charging  the  whole  amount  with  clerk's  fees  passed 
to  excess  fee  account,  and  possibly  question  of  right  of  State  or 
local  communities  to  interest  on  the  fund. 

THE  STATE'S  INTEREST  IN  LIQUOR  LICENSES 

It  is  difficult  to  figure  the  State's  share  in  return  of  liquor 
licenses  in  x\llegany  County,  Anne  Arundel  County,  Carroll 
County,  Frederick  County,  Garrett  County,  Prince  George's 
County  and  Washington  County,  because  in  addition  to  the  State 
license  the  county  or  municipalities  or  towns  issue  a  license  for 
certain  amounts,  and  the  State  receives  no  part  of  such  local 
charge. 


358 


Report  of  the  Commission 


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Licenses  359 

The  following  table  shows  approximately  the  net  share  of  the 
State  in  the  liquor  license  receipts  of  each  county : 

Allegany    K  (— ) 

Anne  Arundel. M;  (  +  ) 

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Baltimore   County V^ 

Calvert Vo 

Carroll   Vi  (—) 

Charles    Va 

Frederick    Vs  ( — ) 

Garrett  ¥o  (—) 

Harford    None. 

Howard  Mo 

Prince  Geogre's M  (  +  ) 

St.   Mary's M 

Washington   Vs  ( — ) 

Havre  de  Grace  pays  the  amount  received  from  licenses  to 
sell  intoxicating  liquor  on  account  of  interest  and  sinking  fund  of 
a  public  debt,  and  the  town  has  been  allowed  to  do  this  for  about 
twenty-five  years  without  protest.  It  is  the  only  case  in  the  State 
where  the  local  community  keeps  the  entire  return  and  in  which 
the  State  does  not  participate  at  all.  Howard  County,  however, 
retains  all  but  one-tenth  for  the  use  and  credit  of  the  town  of 
Ellicott  City,  the  county  seat,  and  Charles  County  retains  all  but 
one-ninth.  The  apparent  discrimination  against  Frederick  and 
Washington  Counties  arises  from  the  fact  that  local  liquor  laws 
require  the  issuance  of  State  trader's  liquor  licenses  and  which 
are  all  paid  to  the  State. 


OTHER  LICENSES. 

Prior  to  the  passage  of  the  Act  of  1910'^^  motor  vehicles 
were  required  to  obtain  a  license  from  the  Secretary  of  State  for 
$3.00,  which  was  good  for  all  times.  The  Legislature,  however,  in 
that  year  passed  an  act  requiring  all  automobiles  to  pay  an  annual 


iiChaptef  207. 


360 


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Licenses  361 

license  tax,  and  the  law  provides  that  the  annual  charge  should  be 
determined  by  the  horsepower  of  the  machine. 

The  act  was  amended  by  the  Legislature  of  1912^-  and  the 
rates  are  now  as  follows : 

$5.00  for  a  motor  vehicle  with  a  rating  of  ten  horsepower  or 
less. 

$10.00  for  a  motor  vehicle  with  a  rating  of  more  than  ten  and 
not  more  than  twenty  horsepower. 

$15.00  for  a  motor  vehicle  with  a  rating  of  more  than  twenty 
and  not  more  than  thirty  horsepower. 

$20.00  for  a  motor  vehicle  with  a  rating  of  more  than  thirty 
and  not  more  than  forty  horsepower. 

$25.00  for  a  motor  vehicle  with  a  rating  of  more  than  forty 
horsepower. 

$3.00  for  motor  vehicles  for  merchandise  and  a  special  license 
to  manufacturers  and  dealers. 

The  act  provides  two  periods,  of  seven  consecutive  days  in  each 
calendar  year,  wherein  non-residents  can  travel  without  obtaining 
any  license,  provided  a  request  for  such  privilege  is  obtained  from 
the  Commissioner  of  Alotor  Vehicles.  This  privilege  is  granted 
without  charge. 

This  license  charge  is  in  addition  to  the  tax  against  the  auto- 
mobile itself,  and  the  return  (less  one-fifth  paid  to  Baltimore 
City)  is  used  for  maintenance  of  improved  roads. 

There  are  numerous  licenses  issued  by  the  Clerks  of  Courts, 
and  discrepancy  exists  in  the  amounts  and  classifications  of  such 
between  reports  of  the  Comptroller  and  this  Commission. 

In  many  of  these  (e.  g.  marriage)  the  State  does  not  participate, 
the  amount  either  being  passed  to  clerk's  fee  account  or  given 
to  the  county. 

These  miscellaneous  licenses  are  the  subject  of  some  concern, 
and  vast  discrepancy  exists  between  the  amount  of  them  in  the 
Comptroller's  report.,  and  in  the  reports  submitted  to  this  Com- 
mission. The  one  item  "auctioneers"  is  cited. 

In  addition  to  State  licenses  local  communities  have  been  em- 
pow^ered  by  local  laws  to  grant  licenses  for  sundry  purposes. 

Dog  licenses  are  usual  in  many  communities. 


i^Chapter  133. 


362  Report  of  the  Commission 

In  Baltimore  City  the  municipality  collects  a  large  amount  from 
wagon  licenses. 

In  Baltimore  County  there  is  a  gunners'  license,  the  fund  being 
charged  with  care  of  game. 

In  Cecil  County  there  is  the  Elk  River  gunning  license,  and  in 
Harford  County  a  license  to  gun  on  the  Susequehanna  Flats. 

There  is  no  hmit  on  the  power  of  local  communities  to  impose 
license  taxes. 


School  Taxes  363 


SCHOOL  TAXES.* 

The  raising  of  revenue  for  purposes  of  education  is  strictly  a 
question  of  taxation,  and  in  this  State  the  question  centres  around 
the  contributions  to  this  account  from  State  and  local  communi- 
ties. The  expenditure  of  the  aggregate  funds  is  also  very  closely 
related  to  the  whole  subject  of  taxation. 

In  the  discussion  of  expenditures  many  administrative  ques- 
tions, both  school  and  general,  present  themselves,  and  such  ad- 
ministrati\  e  questions  will  not  be  discussed  except  when  the  larger 
subjects  of  taxation  and  finances  are  very  closely  related.  The 
discussion  of  the  subject  necessarily  involves  much  compilation 
and  talnilation.  and  the  endeavor  has  been  to  keep  these  to  a 
minimum. 

In  Maryland  there  is  no  system  or  method  of  raising  either 
the  State  or  local  revenue  in  relation  to  school  population,  enroll- 
ment or  attendance,  or  to  the  actual  needs  of  local  conditions. 
Local  communities  raise  sums  by  levy  for  schools  that  are  arbi- 
trary in  amount  and  have  no  relation  to  any  of  their  actual  needs 
and  requirements.  If  such  estimates  are  based  on  school  popula- 
tion, the  methods  are  imperfect;  if  based  on  enrollment,  the  same 
criticism  applies ;  if  based  on  average  attendance,  the  result  is 
woefully  bad ;  if  salaries  of  teachers  are  the  controlling  factors, 
the  result  is  most  inequitable.  The  aggregate  is  based  on  aggre- 
gate amounts,  which  vary  in  all  communities,  and  therefore  does 
not  take  into  account  the  needs  of  special  localities. 

The  State  aggregate  contribution  is  just  as  imperfectly  con- 
sidered. The  State  rate  is  levied  on  a  State  basis  of  assessment 
of  valuation  of  property  that  is  constantly  increasing;  it  is  also 
levied  on  the  amount  of  stock  of  Maryland  corporations  that  is 
constantly  increasing;  and  also  on  the  issue  of  Baltimore  City 
stock,  the  aggregate  issue  of  which  is  increasing.  It  is  conse- 
quently impossible  to  estimate  the  amount  which  the  State  rate 
for  schools  will  produce  in  any  year. 

*NoTE. — Costs  of  administration,  including  salary  of  superintendent, 
assistants,  office  expenses,  etc.,  are  derived  from  the  State  sclnool  tax.  No 
attention  has  been  directed  to  levies  in  communities  which  have  a  school 
loan  or  indebtedness,  and  in  which  an  additional  levy  is  imposed  for  the 
purpose  of  paying  interest  and  sinking  fund  on  account  of  outstanding 
debt. 


364  Report  of  the  Commission 

Just  as  imperfect  is  the  distribution  of  the  school  revenue  after 
it  has  been  raised  by  taxation,  because  of  the  fact  that  the  distribu- 
tion plan  is  conceived  in  error  and  is  administered  with  injustice. 

THE  STATE'S  CONTRIBUTION  TO  SCHOOLS. 

It  is  inconceivable  that  any  person  would  advocate  that  the 
entire  expense  of  education  should  be  borne  by  the  State  by  means 
of  levying  taxes.  Such  a  theory  would  be  entirely  fallacious,  and 
would  tend  neither  to  the  furtherance  of  education  nor  to  the 
advancement  of  any  community.  Local  pride  is  strong  in  local 
products,  and  without  local  contribution  there  is  not  the  same 
incentive  to  proper  management.  The  line  of  demarcation  be- 
tween State  and  local  contributions  for  purposes  of  education  is 
difficult  to  determine,  and  it  would  seem  that  the  best  results  have 
been  obtained  in  those  States  which  have  provided  for  the  State 
contribution  per  child  based  either  on  enrollment  or  average  at- 
tendance. 

The  suggestion  of  those  who  have  studied  this  subject  through 
the  agency  of  the  Russell  Sage  Foundation,  Division  of  Educa- 
tion, would  seem  to  be  the  ideal  one. 

In  this  report!  there  is  this  suggestion : 

"American  experience  shows  that  school  tax  legislation  should 
provide  for 

"A.  Sufficient  local  taxation  to  encourage  local  pride  and 
initiative. 

"B.  Sufficient  State  taxation  to  equalize  educational  advantages 
by  aiding  poorer  communities. 

"C.  A  distribution  of  school  funds  based  both  on  the  number 
of  teachers  employed  and  the  aggregate  days  of  attendance  of  the 
school  children. 

"D.  The  stimulation  of  progress  through  additional  grants  to 
communities  providing  such  advantages  as  continuation  schools, 
evening  schools,  playgrounds,  medical  inspection,  etc." 

It  is  believed  that  there  are  as  many  ways  of  raising  the  school 
funds  in  the  United  States  as  there  are  States,  but  the  following 
table  shows  the  percentage  of  State  and  local  contributions  for 
schools  of  all  the  States : 


i"A  Comparative  Study  of  the  Public  School  Systems  in  the  Forty-eiglit 
States." 


School  Taxes  365 

Per  Cent,  of  Revenue  Derived 

Frnm ■ — 

Perma- 

Local  State  nent  Other 

Rank.        State.  Amount.  Ta.xes.  Taxes.  Funds.  Sources. 

1  New  York $54,533,303  87.0  9.0  .6  3.4 

2  Pennsylvania....  46,244,762  59.7  15.6  ...  24.7-^ 

3  Illinois   35,666,072  78.8  2.8  2.4  16.0 

4  Ohio 25,504.410  82.7  9.2  1.0  7.1 

5  Massachusetts...  20,135,745  96.8  .9  1.1  1.2 

6  California 19,072,622  69.8  26.4  1.7  2.1 

7  New  Jersey 17,372,451  66.9  17.5  .1  15.5 

8  Indiana  14,818,795  71.6  16.5  4.5  7.4 

9  Minnesota  14,318,529  59.9  14.7  6.1  19.3-' 

10  Michigan    13.888,691  51.9  38.6  2.5  7.0 

11  Iowa    13,102.491  81.1  ....  7.5  11.4 

12  Missouri  13,003.235  80.6  12.5  6.9  .... 

13  Wi.sconsin    11.393,048  65.7  14.1  1.7  18.5 

14  Texas 10,480.701  38.9  41.0  16.2  3.9 

15  Washington   ....  9,242,087  64.8  21.4  7.0  6.8 

16  Kansas 8.229.575  93.8  ....  6.1  .1 

17  Nebraska  6,928,556  75.1  .5  8.4  16.0 

18  Kentucky   6,619.499  40.0  53.0  ....i  7.0 

19  Colorado    5,970,643  86.4  ....  2.3  11.3 

20  Connecticut  5,538,437  80.6  12.1  1.9  5.4 

21  North  Dakota.  ..  5,254,970  75.0  .8^  19.7  4.5 

22  Oregon    4,591,552  80.0  ....  6.9  13.1 

23  Tennessee 4,444,169  67.1  13.0  2.9  17.0 

24  Georgia 4.423.754  29.6  51.0  2.0  17.4 

25  Virginia  4.348,849  51.7  38.1  1.0  9.2 

26  Louisiana   4,294.529  57.8  22.5  2.8  16.9 

27  South  Dakota...  3,909,387  78.2  ....  14.9  6.9 

28  Maryland 3,892,412  60.8  38.0  1.2 

29  West  Virginia...  3,845,541  72.0  17.0  2.0  9.0 

30  Arkansas  3.676.676  59.2  33.8  1.5  5.5 

31  Oklahoma-"    ....  3,326,699  76.0  ....3  15.8  8.2 

32  Maine   3,288,147  61.8  35.2  1.3  1.7 

33  North  Carolina.  .  2,987,915  88.0  9.0  ....i  3.0 

34  Mississippi   2,927,548  40.7  45.1  10.1  4.1 

35  Alabama 2,868,774  24.0  69.4  4.7  1.9 

36  Montana 2,698.738  87.9  ....  6.7  5.4 

37  Utah    2.630.141  73.2  22.5  4.3 

38  Rhode  Island...  .  2.248,025  90.9  6.7  1.9  .5 

39  Idaho   2,098,027  79.4  14.0  ....  6.6 

40  South  Cai-olina..  2,076,549  83.9  3.9  ....  12.2 

41  New  Hampshire.  1,616.777  88.2  7.0  ....i  4.8 

42  Vermont 1.490.605  77.3  16.5  3.3  2.9 

43  Florida    1,450,141  83.3  11.0  2.5  3.2 

44  Arizona   875.456  78.4  7.4  ....  14.2 

45  Wyoming   768.923  77.5  ....  19.5  3.0 

46  New  Mexico....  752,255  85.2  ....  7.8  7.0 

47  Delaware  598,200  64.4      25.8  6.9  2.9 

48  Nevada 575,876  51.1  35.0  ....  13.9 

1  Included  with  State  tax.  -  IncUided  receipts  from  bond  sales. 
^  Included  with  permanent  funds  and  rents.        •*  For  high  schools  only. 
5  Statistics  of  1908-9. 


366  Report  of  the  Commission 

Examination  of  this  table  shows  that,  in  1910,  of  the  total  school 
revenue  in  this  State,  38  per  cent,  was  derived  from  State  taxation 
and  60.8  per  cent,  was  raised  by  local  taxaton,  the  balance  being 
derived  from  permanent  funds.  The  ratio  of  contributions  in  the 
different  States  varies  from  %o  of  1  per  cent,  in  Massachusetts 
to  69.4  per  cent,  in  Alabama.  The  only  States  in  which  the 
State's  contribution  is  exceeded  by  the  State's  contribution  in 
Maryland  are  Michigan,  Texas,  Kentucky,  Georgia,  Virginia, 
Mississippi  and  Alabama. 

The  State  rate  for  schools  in  Maryland  for  the  last  ten  years 
has  been  as  follows : 

123/ic.  on  $100  in  1903. 

1634c.  on  $100  in  1904,  1905  and  1906. 

16c.      on  $100  in  1907  and  1908. 

14c.      on  $100  in  1909. 

I21/2C.  on  $100  in  1910. 

161/sc.  on  $100  in  1911  and  1912. 

CONTRIBUTION   OF  THE   STATE  AND   LOCAL  COM- 
MUNITIES FOR  THE  LAST  TEN  YEARS. 

State  Aggregate  Local 

Year.  Contribution.  Contribution.  Total. 

1903 $772,105  37  $1,731,965  34  $2,514,090  71 

1904         ....  771,053  57  1,801,601  94  2,572.655  51 

1905 1,108,862  70  1,876,381  54  3,356,901  92 

1906 1,174,823  38  1,901,127  40  3,075,950  78 

1907         ....  1,485,122  94  1,939,287  06  3,424,410  00 

1908 1,415,351  25  2,087,746  82  3,503,098  07 

1909 1,487,937  IZ  2,296,954  09  3,784,891  82 

1910 1,527,99161  2,314,45122  3,842,443  05 

1911 1,344,760  67  2,589,189  26  3,933,949  93 

1912 1,559,852  06  2,487,499  74  4,047,349  80 

LOCAL  CONTRIBUTIONS. 

There  is  no  system  of  raising  local  taxes  on  account  of  schools. 

The  aggregate  amount  needed  for  school  expenses  is  computed 
and  a  rate  of  taxation  fixed  which  will  produce  that  amount  less 
the  State's  contribution  to  that  county.  There  is  more  method  in 
this  plan  than  in  the  State's  method  of  raising  its  revenue,  but  the 


School  Taxes  367 

vice  lies  in  the  fact  that  the  State  has  no  control  over  local 
contributions,  and  may  become  the  larger  contributor  unless  there 
is  some  minimum  rate  fixed  by  law  for  local  communities  to  im- 
pose. Attention  is  directed  to  the  sums  raised  locally  in  1912, 
which  demonstrates  conclusively  the  need  of  better  co-operation. 
The  State's  contribution  in  this  year  increased  16  per  cent,  over 
1911,  while  the  aggregate  local  amounts  diminished  nearly  4 
per  cent. 

COMPARATIVE  TABLE  OF  LEVIES  i  FOR  SCHOOLS  IN 

1911  AND  1912  OF  THE  COMMUNITIES 

OF  MARYLAND. 

Local  School  Levy — 
1911.  1912. 

Allegany  56.2  38.9 

Anne  Arundel   33  31.1 

^Baltimore  City 25.7  24.3 

*Baltimore  Countv 37  34.5 

Calvert ' 20  23.1 

Caroline 38.5  30 

Carroll   21  20.8 

Cecil 32.8  33.1 

Charles   21  17.3 

Dorchester   39.3  27.7 

Frederick    40  32.6 

*Garrett    32.2  23.5 

Harford 33  27.9 

Howard  18  17.3 

Kent 41  35.2 

Montgomery  31.4  23.8 

Prince  George's 25  29.9 

Queen  Anne's 30  40.2 

*St.  Mary's 15  13.6 

Somerset   .  .    .  .■ 25  32.1 

*Talbot  37.3  21.3 

*\\'ashington    30.8  27.2 

*\\'icomico   31.0  27.2 

*\\'orcester 46.0  36.8 


1  Levies  for  bonded  debt  on  account  of  schools  not  included.     Building 
funds  included. 
*Also  less  in  aggregate  amounts. 


368  Report  of  the  Commission 

DISTRIBUTION  METHOD  OF  THE  STATE'S   SCHOOL 

FUNDS. 

There  are  in  Maryland  two  funds  to  be  distributed,  both  of 
whicli  are  disbursed  according  to  a  different  plan. 

The  school  fund  proper  is  distributed  to  the  counties  and  Balti- 
more City  according  to  the  ratio  of  children  of  school  age  in  each 
to  the  total  number  in  the  State,  and  this  ratio  is  changed  imme- 
diately following  a  census  by  the  United  States. 

The  free  book  fund  is  distributed  in  proportion  to  the  number 
of  enrolled  pupils  in  each  county  to  the  whole,  and  is  changed  bi- 
annually. 

The  theory  of  the  distribution  is  wrong.  A  community  that  is 
growing  rapidly  suft'ers  at  the  expense  of  those  communities  that 
are  not  growing  or  are  losing  in  population,  and  allowances  are 
made  for  children  not  attending  schools,  which  proportion  varies 
greatly  throughout  the  State. 

The  Maryland  Educational  Commission^  appointed  at  the  end 
of  the  legislative  session  of  1908,  in  its  report  submitted  to  the 
Legislature  of  1910,  summarizes  this  situation  in  the  following 
language : 

"ilie  distribution  of  tlie  State  school  tax  upon  the  present  basis 
of  tlie  numijcr  or  chiiaren  oetween  the  ages  ot  hve  and  twenty 
is  crude  and  works  a  hardship  on  those  counties  that  make  tne 
best  showing  m  the  enrollment  and  average  attendance  of  pupils. 
It  seems  to  your  Commission  wise  to  take  into  account  the  number 
of  children  who  actually  attend  school,  the  number  of  school 
teachers  employed,  and  the  county  school  tax  rate  as  factors  to  be 
considered  in  determining  an  equitable  basis  for  apportionment." 

The  school  age  in  Maryland  as  fixed  by  law  is  from  five  to 
twenty  years,  and  the  almost  universal  practice  elsewhere  it  is 
five  to  eighteen. 

Examination  shows  that  the  number  of  children  of  the  school 
age  is  not  accurately  computed  in  this  State,  either  in  the  aggre- 
gate or  as  regards  local  communities.     According  to  the  United 


2This  Commission  was  composed  of  J.  Charles  Linthicum,  chairman; 
W.  McCulloh  Brown,  secretary ;  Ira  Remsen,  Thomas  H.  Lewis,  William 
B.  Baker,  M.  B.  Nichols,  Blair  Lee,  James  W.  Cain,  John  P.  Moore  and 
M.  Bates  Stephens. 


School  Taxes  369 

States  census,  28  per  cent,  of  the  population  are  between  the 
ages  of  five  and  eighteen  years.  Allowance  for  the  Maryland 
school  age  would  increase  the  percentage  very  slightly.  The  total 
population  of  Maryland  is  1,294,450,  and  it  is  estimated  that 
415,908,  or  33  per  cent.,  are  of  the  school  age,  the  ratio  varying 
materially  in  different  counties.  According  to  the  basis  used, 
over  40  per  cent,  of  the  people  of  St.  Mary's  County  (the  county 
having  the  largest  proportion)  are  of  school  age,  since  in  this 
county  there  are  estimated  to  be  6.998  school  children  out  of  a 
total  population  of  17,030. 

Further  consideration  of  the  question  of  school  population 
shows  there  is  but  little  connection  between  the  increase  or  de- 
crease of  the  number  of  school  children  at  the  three  census 
periods  of  1890,  1900  and  1910;  some  counties  which  have  suf- 
fered a  loss  of  population  are  credited  with  an  increase  of  school 
children,  and  other  counties  which  have  maintained  an  increase  of 
population  contain  a  less  number  of  school  children. 

TABLE  SHOWING  NUMBER  (ESTIMATED)   OF  CHIL- 
DREN  OF   SCHOOL  AGE    (5   TO  20  YEARS)    AT 
THE  CENSUS  PERIODS  1890.  1900  AND  1910. 

1890.  1900.  1910. 

■\llegany 12,910  16.840  21.885 

Anne  Arundel  9,455  13,075  13.720* 

Baltimore  City 95,156  140,016  163,827 

Baltimore  County   26,460  25,396t  39,306 

Calvert    .' 3,913  4,155  4,116t 

Caroline    4,766  5.465  6,814 

Carroll  9.974  11,671  10,805t 

Cecil 8,626  9,128*  7,539* 

Charles   6,738  6,330t  6,608* 

Dorchester  7,675  9,463  10,491 

Frederick   16,291  17,871  17,457t 

Garrett 4,504  5,712  7.502 

Harford    9,096  10,417*  9,009* 

Howard    5.453  6,305  5.607* 

Kent 5,807  6,414  5,651* 

Montgomery 8,176  10.655  10,800 

Prince  George's  9,154  10.731  12,603 

Queen  Anne's 6,455  7,081*  5.924* 

St.  Mary's 6,061  6,917  6,998* 

Somerset   7,499  9,778  9,6491 

Talbot  6.085  7,245  6.579* 

Washington   12,455  14,459  16,064 

Wicomico    5.954  7.922  9.192 

Worcester  6,552  7,846  7.759j 

295,215  370,892  415,908$ 

*County  showed  a  decrease  of  population  between  census  periods. 
tCoiinty  showed  an  increase  of  population  between  census  periods. 
±24%  increase  in  20  years  in  population  ;  40%  increase  in  the  number  of 
school  children. 


370  Report  of  the  Commission 

A  minute  study  of  statistics  of  the  children  of  school  age 
shows  the  inaccuracy  of  the  present  methods,  and  it  is  believed 
that  Maryland  suffers  more  in  comparison  with  other  States  on 
account  of  this  system  of  apportionment  and  relation  of  average 
attendance  to  population  than  from  any  one  cause. 

PER  CAPITA  COST  OF  EDUCATION. 

The  Department  of  Public  Education  compiles  annually  figures 
showing  the  per  capita  cost  of  education  reckoned  on  average 
enrollment  and  based  on  teachers'  salaries,  books  and  stationery, 
incidentals,  supervision  and  miscellaneous  expenses,  and  this  table 
is  here  inserted : 

TABLE  SHOWING  PER  CAPITA  COST  RECKONED  ON 
AVERAGE  ENROLLMENT  AND  BASED  ON  TEACH- 
ERS' SALARIES.  BOOKS,  STATIONERY,  INCIDEN- 
TALS AND  SUPERVISION. 

Allegany $17  26 

Anne  Arundel  12  32 

Baltimore  City 27  86 

Baltimore  Countv 23  44 

Calvert ' 10  34 

Caroline 13   18 

Carroll  ..; 15  11 

Cecil    19  12 

Charles   10  61 

Dorchester   12  55 

Frederick    15  72 

Garrett    12  14 

Harford 16  98 

Howard  15  84 

Kent  18  95 

Montgomery  16  32 

Prince  George's 12  81 

Queen  Anne's 14  76 

St.  Mary's 9  42 

Somerset    12  01 

Talbot 16  72 

Washington    14  87 

Wicomico 12  72 

W^orcester 13  71 

The  State  $19  81 


School  Taxes  371 

It  appears  that  the  cost  varies  from  $9.42  in  St.  Mary's  County 
to  $27.86  in  Baltimore  City ;  the  percentage  of  attendance  to  en- 
rolhnent  is  also  set  out  in  Table  "G"=^  and  the  extremes  of  these 
percentages  are  57.7  per  cent,  in  St.  Mary's  and  89.iS  per  cent,  in 
Baltimore  City,  with  an  average  percentage  of  attendance  of 
77.1  per  cent.  Questions  of  the  increase  of  teachers'  salaries, 
character  of  school  buildings  and  supervision  are  properly  ad- 
ministrative questions,  land  have  no  association  with  taxation 
problems. 

BASED    ON    AVERAGE   ATTENDANCE. 

In  order  to  reach  a  common  basis  for  the  proper  contrast  of 
the  cost  of  educating  children,  it  has  been  deemed  advisable  to 
compute  the  per  capita  cost  based  on  average  attendance,  using 
the  same  items  of  expenses  that  are  used  by  the  Department  of 
Public  Education  in  arriving  at  its  figures.  New  buildings  and 
improvements  have  not  been  considered,  and  very  properly,  but 
allowance  must  be  made  for  inaccuracies,  as  the  reports  were  com- 
piled with  different  objects  in  view.  In  this  connection  is  con- 
trasted State's  contribution  per  average  attendance  and  local  con- 
tributions per  average  attendance. 

DISCUSSION. 

Reduced  to  this  basis,  contrasts  are  not  so  sharp.     As  regards 
the  total  per  capita  cost,  there  is  some  similarity  in  the  communi- 
ties which  are  alike  in  Maryland.    The  strictly  agricultural  coun- 
ties  show  about  the  same  cost;  the  more  thickly  settled  terri- 
tories show  about  the  same.     The  table  is  more  interesting  from 
the  view  of  the  relation  of  local  and  State  contributions  to  the 
aeereeate  amount  collected.     Over  one-half  of  the  counties  raised 
less  locally  than  is  contributed  to   them.     The  poorest   county 
(Calvert)    does  not  receive  the  largest  per  capita  contribution, 
and  some  of  the  richer  counties  fail  to  raise  local  revenues  in  pro- 
portion to  their  wealth.     Carroll  and  Caroline  Counties  may  be 
fairly  contrasted.     The  aggregate  cost  is  identical,  but  in  Carroll 
County  the  local  amount  far  exceeds  the  State's  donation,  while 
the  opposite  condition  prevails  in  Caroline. 

Harford  and  Talbot  Counties  present  a  striking  contrast,  as 
do  Washington  and  Montgomery.  The  similarity  of  conditions 
and  results  in  Kent  and  Cecil  are  marked. 


^Report  of  Department  of  Public  Education. 


372  Report  of  the  Commission 

CHANGES  IN  ATTENDANCE. 

There  is  no  relation  between  the  State's  contribution  and  the 
amounts  raised  locally  when  compared  with  enrollment  or  at- 
tendance. Every  county,  without  exception,  and  Baltimore  City 
received  more  from  tlie  State  in  1912  for  schools  than  in  1911. 
Along  with  this  increase  in  appropriation  there  were  the  follow- 
ing changes  in  enrollment  and  average  attendance.  The  tabula- 
tion is  also  made  of  the  1911  school  figures  with  the  1910  figures. 

TABLE  SHOWING  PER  CAPITA  COST  OF  EDUCATION 
BASED  ON  AVERAGE  ATTENDANCE.  THE  STATE'S 
CONTRIBUTION  OF  SUCH  PER  CAPITA  COST  AND 
THE  LOCAL  CONTRIBUTIONS  OF  THE  SAME  FOR 

THE  YEAR  1912. 

State's  Local 

Contribution  Contribution 

of  the  of  the  Total,  or 

Per  Capita  Per  Capita         Per  Capita 

Cost.  Cost.  Cost. 

Allegany S^  ^7  $12  39  $2136 

Anne  Arundel   8  21  10  04  18  2.-^ 

Baltimore  City  9  27  21  63  30  90 

Baltimore  County 9  46  21   06  30  S2 

Calvert    '. 11   51-  5  41  16  92 

Caroline 1 1  21  9  94  21   15 

Carroll  9  52  11  64  21   16 

Cecil               10  45  15  67  26  12 

Charles   13  05  5  08  18  13 

Dorchester  9  87  8  77  18  64 

Frederick   9  14  12  63  21  77 

Garrett    9  74  7  67  17  41 

Harford    10  43  13  28  23  71 

Howard 12  55  11   12  23  67 

Kent    10  74  16  13  26  87 

Montgomery  1171  1 1   70  23  41 

Prince  George's    9  31  9  30  18  61 

Queen  Anne's 8  31  13  58  2189 

St.  Mary's 12  57  3  75  16  32 

Somerset   10  61  6  79  17  40 

Talbot  12  44  10  59  23  03 

Washington   7  81  1172  19  53 

Wicomico  1122  7  48  18  70 

Worcester   10  61  9  79  20  40 

The  State $9  76  $15  93  $25  69 


School  Taxes 


2^7Z 


TABLE  SHOWING  INCREASE  OR  DECREASE  IN  THE 
NUMBER  OF  DIFFERENT  PUPILS  ENROLLED  BE- 
TWEEN 1910,  1911  AND  1912  IN  THE  COUNTIES  AND 
BALTIMORE  CITY;  ALSO  THE  INCREASE  OR  DE- 
CREASE IN  THE  NUMBER  OF  PUPILS  IN  AVERAGE 
ATTENDANCE  FOR  THE  SAME  TIME. 


1910-11 

Change  in 

Total 
Number  of 

Different  Change  in 

Pupils  Average 

Enrolled.  Attendance. 

Inc.     Dec.  Inc.  Dec. 

Allegany 172  ...  69 

Anne  Arundel 210  ...  116 

Baltimore  City 1,108  92  ... 

Baltimore  County.  .  .    191      ...  7 

Calvert    21  ...  36 

Caroline    12     ...  27 

Carroll  380  ...  .90 

Cecil 34  ...  90 

Charles 74  ...  123 

Dorchester   *.    .  .  .     267  ...  168 

Frederick   87     ...  46  ... 

Garrett    354  ...  191 

Harford    121  ...  80 

Howard  117     ...  75 

Kent 56     195 

Montgomery  171      ...  110  .... 

Prince   George's.  .  .  .    532     .  .  .  607 

Queen  Anne's 103  ...  181 

St.  Mary's Z7  ...  129 

Somerset   141  ...  83 

Talbot 49  ...  123 

Washington   249     2>7 

Wicomico 77     ...  58 

Worcester   260  .. .  80 

State   274  .. .  413 


Change  in 

L-li. 

Total 

Number  of 

Different 

Change  in 

Pupils 

Average 

Enrolled. 

Attendance. 

Inc. 

Dec. 

Inc. 

Dec. 

817 

23 

74 

25 
393 

196 

760 

•   •  • 

•   •  • 

39 

28 

34 

58 

42 

175 

74 

13 

313 

30 

71 

44 

224 

87 

•   •   • 

144 

96 

•   •  > 

233 

96 

201 

>   •   • 

60 

90 

118 

<    •   ■ 

202 

19 

128 

62 

351 

47 

.   •  • 

27 

123 

78 

123 

,   , 

135 

68 

105 

. 

13 

162 

77 

145 

162 

1,059 


1  Change  of  date  of  report  from  December  31  to  June  30. 


374 


Report  of  the  Commission 


TABLE  SHOWING  AMOUNTS  OF  ALL  TAXES  i  PAID 
BY  COLLECTORS  OF  THE  COUNTIES  AND  BALTI- 
MORE CITY  TO  THE  STATE  ON  ACCOUNT  OF 
LEVIES  2  FOR  ALL  ITEMS,  CONTRASTED  WITH 
AMOUNTS  RETURNED  BY  THE  STATE  FOR 
SCHOOLS. 

Total  Amount  Payment  by  the 

of  Taxes3  State  to  the 

Paid  for  All  County  for 

Items.4  Schools.5 

Allegany $65,347  39  $84,133  19 

Anne  Arundel  41,589  48  51.075  28 

^Baltimore  City 1,108,468  41  549,749  41 

♦Baltimore  County 301,449  77  142,145  81 

Calvert    '. 6,709  33  15,658  83 

Caroline 19,200  00  33,991   12 

♦Carroll    47,471  36  39,972  65 

Cecil    31.312  19  35,659  44 

Charles  11.628  31  24.39119 

Dorchester   22.683  78  41.881  71 

Frederick   64,508  03  69,571  50 

Garrett   16,875  62  33,583  94 

♦Harford   47,241  39  39,562  22 

♦Howard  25.382  80  22.072  40 

Kent    24.100  61  24.138  92 

Montgomery 46,879  88  47,073  89 

Prince  George's . .  .  33.968  22  49,115  54 

Queen  Anne's 3,682  97  25.841  05 

St.  Mary's 12.500  OQ  24.357  82 

Somerset 15,214  88  36.928  49 

Talbot 19.832  98  32.545  43 

♦Washington   65,890  15  61.565  45 

Wicomico 19,084  03  38,999  24 

Worcester 15,045  57  35,837  52 

The  State $2,066,067  15  $1,559,852  06 

♦Payments  into  the  State  Treasury  exceed  returns  by  State  on  account  of 

schools. 

1  Amount  includes  payment  of  back  taxes. 

-  No  consideration  paid  to  tax  from  Maryland  corporations    (aggregate 

payment  in  1912,  $163,801.60)  nor  to  tax  on  Baltimore  City  stock  (payment 

in  1912  amounting  to  $68,781.82). 
^  From  Report  of  Comptroller,  1912 ;  see  "Collection  of  Taxes." 
^  For  amount  of  the  levies  see  ante  "Collection  of  Taxes." 
^  Includes  appropriations  from  the  Treasury  proper  on  account  of  high 

schools ;    no    consideration    directed   to   payments    from   general    Treasury 

funds  on  account  of  schools,  colleges,  imiversities,  etc.     See  post  ''Cost  of 

Government  in  Maryland." 

BIBLIOGRAPHY. 

Reports  of  the  Department  of  Public  Education,  1903  to  1912,  inclusive. 

State  Common  School  System  :  Department  of  the  Interior,  Bureau  of 
Education.     Statistical  Survey  of  Education,  ibxd. 

Public  Education  in  Maryland  :  A  Study  of  Its  Finances.  Dr.  Tliomas 
Hamilton  Lewis,  September,  1909. 


Cost  of  Government  in  Maryland  375 


COST  OF  GOVERNMENT  IN  MARYLAND. 

RECEIPTS  AND   EXPENDITURES  OF  THE  STATE  OF  MARY- 
LAND FOR  THE  YEARS  1911  AND  1912. 

SUMMARY    OF    CLASSIFIED    RECEIPTS    INTO    THE 

STATE  TREASURY  FOR  THE  YEARS 

1911  AND  1912. 

1911.  1912. 

Productive  assets  of  the  State.  ....  $98,249  65  $93,457  25 
Returns     from    departments    and 

civil  officers 154,689  81  186,186  29 

Corporations,  private   (other  than 

tax  against  real  estate) 522,120  31  410.803  59 

Corporations,  quasi-public  760,462  02  780,586  12 

Earnings  of  institutions 35,151  84  25,667  68 

Interest  on  accounts 38,399  22  32,450  73 

Inheritances  and  estates 370,075  70  352,829  20 

Chesapeake  Bay  and  oysters 95,259  63  84.681  20 

Licenses    1,941,965  81  1,937,088  04 

Taxes,  general,  from  collectors.  .  .  1,779,307  99  2,066,068  77 

Baltimore  City  stock  tax 63,350  55  68,781  82 

Miscellaneous  56,124  95  184,890  74 

Bond  issue  and  new  State  debt.  . .  2,791,335  97  2,684,988  29 

$8,706,493  45    $8,908,454  16 
Items  not  properly  considered  as 
revenue,    e.    g.,    new    debt    and 
licenses  returned 3,918,862  99       3,799,793  84 

Net   revenue   for  the  use   of 
the  State i$4,787,630  46  2$5,108,660  32 

1  Balance  in  Treasury  September  30,  1910,  $875,111-16. 

2  Balance  in  Treasury  September  30,  1911,  $1,471,520.64. 

(There  are  some  other  small  items  that  might  be  deducted,  e.  g.,  return 
of  motor  vehicle  licenses  to  Baltimore  City  (%)  ;  Va.  of  fees  of  Public 
Service  Commission  of  Maryland.) 


376  Report  of  the  Commission 

PRODUCTIVE    ASSETS.i 

Annapolis  Water  Co.   (stock) $1,800  00  $900  00 

Baltimore  and  Fredericktown  turnpike  (stock)  2,035  00  233  75 

Farmers'  National  Bank  of  Annapolis   (stock)  4,414  65  2,323  50 
Northern    Central    Railway    Co.,    interest    on 

mortgage  ^ 90,000  00  90,000  00 


$98,249  65         $93,457  25 

RETURNS  FROM  DEPARTMENTS  AND  CIVIL  OFFICERS. 

1911.  1912. 

Excess  of  fees  of  office $118,785  56       $149,290  46 

Fines  and  forfeitures   12,192  65  13,010  7Z 

Land    Office 2,029  26  1,58128 

Public  Service  Commission,  fees  of 1,179  95  1,302  85 

Protests  of  notaries  public 1,234  00  918  00 

Recording    fees 1,019  80  1.635  15 

State  hay  scales 118  83  98  50 

State  wharves  (rent  of  piers) 2,000  00  2,000  00 

State  tobacco  inspections 15.128  07  7,285  92 

State  Board  of  Health  repayment 443  13             

State  game  warden 104  46            

Civil    commissions! 454  10  9,063  40 

$154,689  81       $186,186  29 

1  For  list  of  non-productive  assets,  see  Table  I — Report  of  Comptroller. 

2  Amount  of  liquidation  of  stock.  $1,980.00. 

3  Annuity  or  interest  held  by  State ;  nature  of  annuity  discussed  in 
Northern  Central  Railway  Co.  vs.  Hering,  Comptroller,  93  Md.,  164  (186 
U.  S.,  480),  holding  capitalization  of  the  annual  interest  not  redeemable  at 
the  option  of  the  railroad  company. 

1  Commissions  issued  to  officers  of  Maryland  are  subject  to  a  tax  to  the 
State  as  set  out  in  Article  81,  Section  146,  of  the  Code  of  Public  General 
Laws. 

Judges  of  the  courts,  Baltimore  City,  and  Court  of  Appeals  pay  $50; 
sheriff  of  Baltimore  City,  $300 ;  of  Baltimore  County,  Frederick  and 
Washington,  each  $100 ;  of  Allegany,  $75 ;  of  Carroll,  Harford,  Dorchester, 
Anne  Arundel,  Worcester,  Somerset,  Cecil  and  Prince  George's,  $40 ;  of 
Howard,  $30;  of  each  of  the  other  counties,  $20;  Orphans'  Court  judges 
in  Baltimore  City,  $50,  and  in  each  of  the  counties,  $10;  each  justice  of 
the  peace,  $2.00;  inspectors  of  tobacco  and  weighers  of  live  stock,  $50; 
weighers  of  grain  and  hay,  $10;  notaries  public  in  Baltimore  City,  $20; 
clerks  of  courts,  register  of  wills  in  Baltimore  City,  $200;  register  of  wills 
in  Baltimore  County.  $150;  in  Frederick,  $100;  in  Washington,  $75;  in 
Allegany,  Carroll,  Harford,  Kent,  Dorchester,  Anne  Arundel,  Worcester, 
Somerset,  Cecil  and  Prince  George's,  each  $50;  in  Howard,  Caroline, 
Montgomery,  Talbot,  Charles,  Queen  Anne's,  Calvert,  Garrett,  Wicomico 
and  St.  Mary's,  $30 ;  Clerk  of  Court  of  Appeals,  $200,  and  of  Circuit  Courts 
of  counties,  each  $100. 


Cost  of  Government  in  Maryland  377 

CORPORATIONS,    PRIVATE— OTHER    THAN    TAX  ON    REAL 

ESTATE. 

1911.  1912. 
Banks ;    commissions    from    banks    and    trust 

companies  for  inspection  i $6,220  00  $7,385  00 

Bonus  on  corporations  or  incorporation  tax  2.  .          24,027  89  26,554  84 

Charter  fees  from  foreign  corporations  ^ 871  15  1,437  21 

Franchise  tax  on  savings  bank  deposits  ^ 55,913  10  58,562  07 

Franchise  tax  on  charter  rights 1,157  50  31  25 

Tax  on  insurance  companies  ^ 253,618  50  126,434  38 

Penalty  on  corporations 239  05  799  66 

Taxes^  on   shares   of  stock,   Maryland   corpo- 
rations '    8 157,615  10  9 163,801  60 

Tax  on  foreign  corporations^'^ 22,458  02  25,797  58 


$522,120  31  $410,803  59 

CORPORATIONS,  QUASI-PUBLIC. 

1911.  1912. 

Gross  Receipts  tax  i $760,462  02  $780,586  12 


$760,462  02      $780,586  12 


1  Banks  (other  than  national  banks)  and  trust  companies  pay  a  per- 
centage on  amount  of  their  deposits  to  the  Bank  Conimission  for  inspection 
and  supervision.  Department  established  under  provision  of  Ch.  219  of  the 
Acts  of  1910. 

-  One-eighth  of  1  per  cent,  on  amount  of  capital  stock  or  increase. 

3  The  fee  for  recording  is  the  same  allowed  clerks  of  courts  for  record- 
ing documents  of  similar  length,  but  State  Tax  Commissioner  collects  twice 
the  amount,  one  for  State  office  and  other  for  recording  in  the  several 
county  or  city  courts. 

•*  Savings  banks  and  institutions  for  savings  (other  than  building  asso- 
ciations)  pay  25  cents  on  the  $100  of  deposits,  of  which  6%  cents  is  secured 
to  the  State  and  18%  cents  to  the  localities  where  situated. 

^'Besides  fees  for  filing  (see  Art.  23,  Sec.  184.  P.  G.  L.),  all  companies 
pay  IV2%  on  amount  of  premiums  actually  collected  or  secured.* 

6  Designated  in  some  localities  as  "Corporate  Excess  Tax." 

"See  discussion  under  "Taxation  of  Corporations."' 

8  $144,693.12  of  this  amount  is  for  taxes  for  the  year  1911.  Balance  is 
for  taxes  for  prior  j-ears. 

9  $151,242.23  of  this  amount  is  for  taxes  for  the  year  1912.  Balance  is 
for  taxes  for  prior  years. 

1*^  Foreign  corporations  pay  a  franchise  tax  of  $25  for  every  full  $50,000 
of  capital  employed  in  the  State ;  if  over  $500,000  and  not  ov'er  $5,000,000. 
an  additional  sum  equal  to  one-fortieth  of  1  per  cent. ;  if  over  $5,000,000, 
an  additional  sum  of  $30  for  every  million  of  last-named  excess. 

*See  Acts  of  1912,  Ch.  207. 

iThe  rate  varies  on  different  classes  of  corporations  from  1%  to  2V2%. 


378  Report  of  the  Commission 

EARNINGS   OF  INSTITUTIONS. 

i 

Maryland    Penitentiary $35,151  84         $25,667  68 


$35,151  84  $25,667  68 
INTEREST. 

1911.  1912. 

Interest  on  personal  accountsi $10,173  91  $12,559  11 

Interest  on  deposits   (State) 15,34171  18,548  64 

Interest    on    deposit    of    the    Baltimore    City 

Collector    424  44  396  70 

Interest  on  public  debt 12,459  16  945  62 


$38,399  22         $32,450  17> 

INHERITANCES    AND    ESTATES. 

Commission     of     Executors     and     Adminis- 
trators!          2 $59432  49         $63,223  31 

Collateral    Inheritance    tax^ 2310,943  21         289,605  20 


$370,075  70       $352,829  20 
CHESAPEAKE  BAY  AND   OYSTERS.^ 


General  measurer  and  inspector  of  oysters.  ..  . 

Fishery,   Chesapeake   Bay 

Oyster  house  licenses    

Oyster  canners',  packers'  and  commission  mer- 
chants' licenses    

Oyster  measurers'   licenses    

Purse  met  licenses   

Race  and   fishing   licenses 

Dredge  for  oysters  licenses    

Tong  and  scrape  licenses 

Oyster    fines 

Oyster  fund  from  Clerks  of  Circuit  Courts 
of  Kent,  Talbot  and  Queen  Anne's 

Reshelling   oyster   bars2 


1911. 

1912. 

$25,403  20 

$41,138  11 

471  45 

454  88 

6.456  12 

6,254  23 

4,464  75 

4,294  50 

204  25 

166  25 

200  00 

200  00 

7  60 

3  80 

19,469  85 

19,972  81 

10.364  15 

9,222  70 

715  45 

831  85 

2.110  00 

2,115  76 

25,392  81 

$95,259  63        $84,655  55 


!  See  Expenditures,  "Chesapeake  Bay  and  Oysters."' 

2  This  item  is  amount  of  licenses  received  from  individuals  and  col- 
lected under  the  Act  of  1910,  Ch.  735,  afterwards  declared  unconstitutional 
in  the  case  of  Foote  vs.  Clagett,  116  Md.,  229. 

1  Executors  and  administrators  pay  for  the  use  of  the  State  10%  of 
commissions  allowed  by  the  Orphans'  Court.  Commission  allowed  by  the 
Orphans'  Court  is  from  2%  to  10%  in  the  discretion  of  the  Court  on  es- 
tates up  to  $20,000 ;  portion  over  $20,000,  not  over  2%. 

2  For  amounts  from  each  county  and  Baltimore  City.  See  Comptroller's 
Report,  Table  2. 

3  All  estates  over  $500  passing  to  collateral  heirs,  devisees,  legatees  and 
distributees  are  subject  to  5%  tax. 

1  Inckides  interests  on  deferred  taxes.  See  "Collection  of  Taxes,  Dis- 
count, Interest  and  Penalty." 


Cost  of  Government  in  Maryland  379 

LICENSES.i 

1911.  1912. 

Auctioneers  $4,250  00  $3,704  75 

Billiard    tables 15,979  87  29,650  78 

Brokers    26.090  30  28,659  46 

Cigarettes    12,362  75  14,467  56 

Delinquent^   10,504  29 

Exhibition   6,403  50  5,546  10 

Gaugers    99  00  99  00 

Gunners    42  76  35  63 

Gypsy    47  50 

Hawkers  and  peddlers 2.196  41  2,425  71 

High  liquors,   Baltimore   City^ ^  1,501,110  47  ^  1,485,242  82 

Live  stock  dealers 66116  146  52 

Motor    vehicles^ 75,000  00  60,000  00 

Ordinary    24.213  83  24,742  95 

Stevedore    165  01  235  14 

Traders                                           206,306  61  203,898  61 

Traders    Liquor "56,434  14  §57,03122 

To  sell  commercial  fertilizersS 10,650  00  10.650  00 

$1,941,965  81  $1,937,088  04 

TAXES    (GENERAL). 1 

1911.  1912. 

Taxes2  from  collectors  of  counties  and  city.  .  .3 $1,779,251  22  ■^$2,066,067  15 

On    mortgages^ 56  77  1  62 

$1,779,307  99  $2,066,068  77 


1  3cc  ^'Licenses." 

-  Collected  by  Clerk  of  the  Court  of  Common  Pleas  of  Baltimore  City 
under  order  of  Court  for  failure  of  licensees  to  obtain  licenses  by  May  1st. 

3  Portion  of  license  fee  returned  to  Baltimore  City  should  not  be  con- 
sidered as  receipts  of  the  State. 

^$1,125,832.85  returned  to  Bahimore  City. 

5  $1,113,932.11  returned  to  Baltimore  City. 

6  Paid  to  Good  Roads  Commission,  less  one-fifth  paid  to  Baltimore  City. 
'$1,694.17  refunded  to  Calvert  County. 

8 $760.00  refunded  to  Calvert  County,  and  $113.44  refunded  to   Wash- 
ington County. 
9  Since  1912,  paid  directly  to  the  IMaryland  Agricultural  College. 

1  Includes  tax  only  on  real  and  personal  property  and  securities. 

2  The  rate  for  1911  was  22  cents  on  the  hundred,  and  for  1912,  23% 
cents.  .  ,     c 

3  Of  this  amount  $1,452,120.53  was  for  current  taxes  as  reported  to  bep- 
tcmber  30th,  1911.     See  "Collection  of  Taxes." 

^Of  this  amount  $1,581,223.70  was  for  current  taxes  as  reported  to 
September  30th,  1912.  (See  ibid.)  :  Collections  for  1912  were  on  increased 
basis  of  $27,383,705.00. 

5  Law  repealed;  account  of  item  in  arrears. 


380  Report  of  the  Commission 

BALTIMORE  CITY,  FROM  TAX  ON  BALTIMORE  CITY  STOCK. 

1911.  1912. 

Tax   on,   paid  by  Mayor  and   City   Council  of 
Baltimore $63,350  55         $68,78182 


MISCELLANEOUS. 


$63,350  55         $68,781  82 


1911.  1912. 


Boundary    line    between    Maryland    and    West 

Virginiai    $5,393  03            

Carroll  Countj^  fishing $25  65 

Commission  of   Fisheries — repayment 3,104  31 

Contingent  fund  of  Board  of  Public  Works — 

repayment    27  94 

Conscience   fund 19  00  46  00 

Extradition  of  Criminals^ 51  90  76  15 

House  of  Correction^ 45,000  00            

Hospital  for  Negro  Insane^ 6,000  00 

Insane   convicts^ 287  50  89  17 

License    and    tax    on    insurance    companies — 

repayment    23  36 

Insurance — repayment    67  54            

Maryland  Agricultural  College 3,478  30  3,478  30 

Maryland  Hospital  for  the  Insane^ 1,254  97  59,024  44 

Printing   records   and   briefs   in    State   cases — 

refund   42  00 

Postage  of   departments — repaj-ment 33  46 

Retired  teachers'  pensions — repayment 50  00             

Sale  of  the  Laws  of  Maryland 143  50  72  50 

St.  Louis  Exposition  Commission — refund....           1,200  53 

Sale  of  stationery 33  20            

Sale  of  old  furniture 25  00 

Springfield    State    Hospital 346  01  111,62193 


$56,124  95  $184,890  83 

BOND   ISSUE  AND   NEW   DEBT. 

1911.  1912. 

Public  highways,  loan  of  1910 i $256,293  50  2 $251,496  55 

State    Roads    loan 3  1,837,916  97  ^942.242  19 

State   Insane   Hospital   loan ^602,673  50  

Sanatorium     loan 6  94,452  00  

State  loan  of  1912 , '  1,002,202  05 

Technical  School  loan  of  1912 §489,047  50 


$2,791,335  97    $2,684,988  29 

1  Arnount  of  the  loan,  $250,000.     (Appropriation,  Ch.  116,  1910,  $5,000.) 

2  Amount  of  the  loan,  $250,000. 

3  Amount  of  the  loan,  $1,949,000. 

4  Amount  of  the  loan,  $1,000,000. 
^'  Amount  of  the  loan,  $600,000. 

<5  Amount  of  the  loan,  $100,000. 
•^Amount  of  the  loan,  $1,000,000. 
8  Amount  of  the  loan,  $489,000. 

1  Decision  in  case  of  State  of  Maryland  ys.  State  of  West  Virginia,  225 
U.  S.,  1,  part  of  return  costs. 

2  Return  of  money  allowed  to  detectiyes. 
•"'  Refund  of  unused  appropriations. 

"*  Paid  by  counties  or  Baltimore  City  for  county  or  city  inmates. 


Cost  of  Government  in  Maryland  381 
SUMMARY  OF  EXPENDITURES. 

1911.  1912. 

Executive  $37,152  05  $30,997  95 

Legislative  i 5,121  7S  217,824  26 

Judiciarv  2    194,304  48  191,559  06 

Health  '. 64,853  13  75,713  18 

Chesapeake  Bav  and  oysters 100,408  59  135,699  09 

Agriculture  ^    .' 27,445  00  33,760  00 

Administration  ^    246,371  59  282,179  24 

Debt    (interest   and   payments    of 

sinking  funds)   539,088  79  785,765  22 

Roads 2,593,275  45  2,451,118  16 

Charities— Benevolent    377,175  00  377,750  00 

''      —Consumptives   171,278  85  136,000  00 

"      —Blind  41,000  00  41,000  00 

"       —Insane  ^   780,104  92  595,214  63 

"       —Penal  and  reform  «.  .  .  .  82,234  91  76,500  00 
(Total— $1,439,539.68— $1,312,865.45.) 

Schools— General— Public   1,207,392  50  1,417,264  46 

"     —High   183,750  00  214,800  00 

"      — Colleges,    art,    technical, 

universities 211,672  16  156,789  81 

(Total— $1,602.814.6(^$1,797,854.27.) 

Military 88,400  00  107,787  35 

Miscellaneous  36,777  78  112,216  89 


Total  expenditures  "   $6,982,556  95     $7,438,939  30 

1911— Calvert  County   $1,694  17 

Mavor  and  City  Council  of  Baltimore 1,125,832  85 


$1,127,527  02 

1912— Calvert  County   $760  00 

Mayor  and  City  Council  of  Baltimore 1,113,932  11 

Washington    County    113  44 

$1,114,805  55 


1  Legislative  session  in  1912  only. 

2  Library  considered  as  judicial  expense. 

3  Maryland   Agricultural    College   not   properly   considered    in   this    con- 
nection. 

■*  Fee  system  of  payment  of  State  officers  not  considered. 
^  Bond  issues  included. 

^  Maryland  Penitentiary  pays  substantial  sum  to  State. 
"  Return  of  licenses  to  localities  not  considered  as  State  expense.  ^ 
s  Refund  by  State  of  following  licenses  not  considered  as  part  of  State 
expenditures  : 

Note. — Funds  for  some  of  the  above  are  derived  from  bond  sales. 


382  Report  of  the  Commission 

EXECUTIVE. 

1911.  1912. 

Contingent  fund  of  the  Executive $20,000  00  $5,000  00 

Clerical  help  in  Executive  Office 4,000  00 

Support  of  Executive  Mansion 4,452  05  4,297  95 

Repairs  of  Executive  Mansion   5,000  00 

Civil   officers    (account  of  Executive)!   12,700  00  12,700  00 


$37,152  05        $30,997  95 


LEGISLATIVE.1 


1911.  1912. 

Copying  and  indexing  laws $1,500  00 

Legislature-1912 2  182,490  60 

Legislature,   indexing 900  00 

Legislature,  printing   $5,121  75  12,933  66 

Legislature,  counsels  and  agents 200  00 

Publishing  general  laws   ^ 4  19,800  00 


JUDICIARY. 


$5,121  75       $217,824  26 


1911.  1912. 


Augmentation  of  State  Library  ^   $2,500  00         

Contingent  fund  of  Court  of  Appeals 2,500  00  1,929  99 

Contingent  fund  of  library 760  65  540  64 

Indexer  and  cataloguer   1.200  00  1,200  00 

Judges'  pensions  26,545  71  23,700  00 

Judiciary  2    155,798  92  156,979  04 

Maryland  reports   1,200  00  1,200  00 

Office  expenses,  Court  of  Appeals 2,353  34 

Printing  records  and  briefs  in  State  cases.  ...               369  20  ^656  05 

State  reporter   3,430  00  3,000  00 

$194,304  48  $191,559  06 


1  The  State  Library  at  Annapolis  is  a  law  library  connected  with  the 
Court  of  Appeals. 

2  Each  of  the  eight  Judges  of  the  Court  of  Appeals  receives  a  salary  of 
$5,800  and  is  Chief  Judge  of  his  respective  circuit  (except  the  Judge 
from  Baltimore  City).  The  two  Associate  Judges  in  each  of  the  seven 
circuits  receive  $3,600.  The  salary  of  each  of  the  ten  Judges  of  the 
Supreme  Bench  of  Baltimore  City  is  $5,000,  of  which  $4,500  is  paid  by  the 
State  and  $500  by  Baltimore  City. 

^  Repayment,  $42. 

1  Legislature  meets  bi-annually ;  session  in  1912. 

2  A  large  part  of  the  amount  ($47,929.28)  included  in  the  special  appro- 
priations and  credited  to  miscellaneous  should  properly  be  charged  to 
legislative. 

3  Refund  :     Sale  of  Laws  of  Maryland,  $143.50. 

4  Refund  :     Sale  of  Laws  of  Maryland,  $72.50. 

1  Includes  payments  of  salaries  :  Governor,  $4,500 ;  Secretary  of  State, 
$2,000;  chief  clerk,  $2,400;  clerk,  $1,200;  stenographer,  $1,500;  mes- 
senger, $1,100. 


Cost  of  Government  in  Maryland  383 

HEALTH. 

1911. 

Adulteration  of  foods  and  drugs  ^ $16,458  96 

Bureau  of  State  Board  of  Health 9,917  44 

Communicable  diseases   8,315  76 

Hygiene   and    demography 

Pasteur  treatment  for  hydrophobia 

State  Vaccine  Agent  i 2,600  00 

State  Live  Stock  Sanitary  Board  i   11.568  09 

State  Board  of  Health  i  2 15^992  88 

$64,853  13         $75,713  18 

tCHESAPEAKE  BAY  AND  OYSTERS. 

1911.  1912. 

Commission  of  Fisheries    ^  $9,500  00  ^  $17,750  00 

General  measurers  and  inspectors  of  oysters.  .  -15,093  00  3 7  215  50 

Oyster  fund   58.265  61  70,864  33 

Reshelling  oyster  bars ^ ''2f'2°^  Iv. 

Shell    Fish    Commission  6 17,549  98  14,800  00 

$100,408  59       $135,699  09 


1912. 

$13,964  30 

15,338  01 

8,598  17 

1,091  61 

195  79 

2,600  00 

17,197  79 

16,727  51 

AGRICULTURE. 


1911.  1912. 


Agricultural   Fair  Associations $5,000  00  $5,000  00 

Agricultural    Farmers'    Institutes 6,000  00  6,000  00 

License  to   sell   commercial   fertilizers   paid   to 

Maryland  Agricultural  College  1 29,945  QO  3 11,750  00 

Maryland  State  Horticultural   Society 2,000  00  2,000  00 

Peninsula  Horticultural  Society   500  00  500  00 

State  Board   of  Forestry  4    4,000  00  6,000  00 

State  Laboratory  for  Biological  Products  * 2.500  00 

$27,445  00  $33,760  00 


1  See  item  carried  to  schools :  "Colleges,  art,  technical  and  university," 
and  credited  to  Maryland  Agricultural  College.  Receipts  from  license  in 
each  year,  $10,650. 

2  Repayment,  $3,478.30. 

3  Repayment,  $3,478.30. 

'*  May  properly  be  chargeable  to  administration. 

tTotal  receipts  into  the  Treasury  from  all' sources.  Credit  to  "Chesa- 
peake Bay  and  Oysters"  in  1911  $95,259.63,  and  in  1912  $84,681.20. 

1  Repayment,  $3,104.31. 

2  Repavment,  $25,403.20. 

3  Repavment,  $41,138.77. 

4  Repayment  (1911),  $25,392.81. 

5  Refunded  to  licensees  under  decision  of  Foote  vs.  Clagett,  116  Md.,  229. 

6  May  properly  be  chargeable  to  administration. 

1  May  properlv  be  chargeable  to  administration. 

2  Repayment,  $443.13. 


384 


Report  of  the  Commission 


ADMINISTRATION. 

1911. 

Bureau  of  Statistics  and  Information $19,331  94 

Bank  Commissioners    ^  8,086  82 

Civil  officers  3    38,493  21 

Contingent  fund.  Attorney  General  1,500  00 

Contingent  fund,  Land  Office 2,500  00 

Conservation  Bureau  921  78 

Custodian  of  Works  of  Reference 920  00 

Excess  of  fees  of  office 7,852  38 

Elections    1,345  00 

Fuel  and  lights  5,719  17 

Furnishing  Land  Office   400  00 

Inspector   of   Mines   in   Allegany   and   Garrett 

Counties    1,500  00 

Immigration   fund   10,000  00 

Insurance   4,677  83 

Land    Office 4970732 

License  and  tax  on  insurance  companies  **   .  . .  10,000  00 

Maryland  Public  Library  Commission 1,500  00 

Public  Service  Commission   61,412  67 

Public  Service  Commission,  fees  of '''294  97 

Postage  for  departments   1,927  00 

State  Board  of  Education,  expenses  of^^....  3,000  00 
Superintendent  of  Public  Education,  salary  10  3,000  00 
Superintendent  of  Public  Education,  office  ex- 
penses 10    1,000  00 

Superintendent  of  Public  Education,  traveling 

expenses  10    500  00 

Assistant  Superintendent  of  Public  Education, 

salary  10    1,750  00 

Clerk  to  State  Board  of  Education  10 862  50 

State  Tobacco  Warehouses  n  1,548  01 

State  Weather  Service  80  15 

State   Wharfinger    13250  00 

State  Geological  and  Economic  Survey 10,000  00 

State  Game  Warden  153,904  46 

State  Aid  and  Charities  Board  i^  3,496  74 

Steam  Boiler  Inspection  2,257  18 

Ten-Hour  Law  Bureau  ^"^   

Contingent  Fund,  Board  of  Public  Works....  3,487  53 

Contingent  fund.  Comptroller 5,019  17 

Contingent  fund.  State  Treasurer 3,695  50 

Contingent  fund,  State  Tax  Commissioner....  2,390  61 

Revaluation  and  reassessment 330  78 

State  Tax  Commissioner 9,408  87 

State  Auditor    2,300  00 


1912. 

$17,005  02 

29,672  77 

37,650  99 

1,328  77 

2,008  62 

920  00 

13,615  57 

1.015  00 

9,858  56 

1,500  00 

9,350  00 

9.894  28 

5  7,789  96 

10,000  00 

1,500  00 

61,608  49 

8  325  71 

9  2,140  00 

3,000  00 

3,000  00 

1,000  00 
500  00 

1,937  49 

900  00 

12  20,260  55 

1,000  00 

"254 

15.000 

.     3,800 

3,451 

2.126 

2,180 

3,268 

5,221 

4,867 

2,556 
166 

9,500 

1,004 


08 
00 
00 
47 
56 
53 
65 
76 
39 
53 
19 
00 
30 


$246,371  59       $282,179  24 

1  Repayment    by    banks    and    trust    companies    for    supervision,     1911, 

$6,220.00. 

-  Repayment    by    banks    and    trust    companies    for    supervision,    1912, 

$7,385.00. 

3  Portion  of  whole  amount  chargeable  to  executive. 

4  Repayment  from  fees,  $2,029.26. 

5  Repayment,  $1,581.28. 

^  Salary  and  expenses  of  Fire  Marshal. 
■^  Repayment  from  fees,  $1,179.95. 

8  Repayment,  $1,302.85. 

9  Refund,  $33.46. 

19  Collected  and  charged  as  part  of  public  school  tax. 


Cost  of  Government  in  Maryland  3S5 

INTEREST  AND  SINKING  FUNDS  ON  DEBT. 

1911.  1912. 

Interest  on  Consolidated  loan,  1899 $97,617  78  $96,675  32 

Interest  on  Public  Building  loan 56,875  00  56,752  50 

Interest  on   State   Building  and   Improvement 

loan    15,000  00  15,000  00 

Interest  on  State  loan  of  1902 18,000  00  18.000  00 

Interest  on  State  Roads  loan 105.000  00  140.000  00 

Interest  on  State  Insane  Hospital  loan 6,000  00  24,000  00 

Interest  on  Public  Highways  loan  of  1910.  . .  .  5.000  00  15,000  00 

Interest  on  Sanatorium  loan 1,750  00  2,450  00 

Public  Buildings  loan.  State  House  i 2,435  56 

Public  Buildings  loan,  House  of  Correction  i.  .  208  38            

Sinking    funds2 233,637  63  415,45184 

$539,088  79         $785,765  22 

ROADS. 

1911.  1912. 

Motor  vehicle  licensesi 2 $37,818  02  '  3 $58,735  86 

Public  highways^ 109,627  11  136,994  31 

Public  Highways  loan  of  1910 5257,017  50  ^251,757  75 

State    Roads    loan ^2,138,812  82  8942,867  14 

State  Loan  of  1912 91,000,763  10 

State  Road  No.  1..: 50,000  00  60.000  00 

$2,593,275  45    $2,451,118  16 

11  Fees  from  tobacco  inspections,  $15,128.07. 

12  Fees  from  tobacco  inspections,  $7,285.92. 

13  Fees  from  State  wharves,  $2,000.00. 

14  Fees  from  State  wharves,  $2,000.00. 

15  $104.46  is  fines  imposed  by  Warden. 
K^  Not  probably  chargeable  to  charities. 
17  Created  by  Acts  1912,  Ch.  79. 

Note. — A  great  many  officers  are  paid  by  fees,  which  amounts  are  not 
included. 

1  Balance  of  bond  issue,  Act  of  1904.   • 

2  Transfer  from  Treasury  proper  to  sinking  funds. 

1  Acts  1910,  Ch.  207,  provides  that  receipts  from  licenses  of  automobiles 
shall  be  used  for  oiling,  repairing  and  maintenance  of  the  improved  roads 
of  the  State,  less  one-fifth  paid  to  Baltimore  City  for  streets. 

For  amount  of  tax  which  was  increased  see  Acts  1912,  Ch.  133. 

2  Receipts  from  licenses,  $75,000.00. 

3  Receipts  from  licenses,  $60,000.00. 

4  Under  the  provisions  of  the  Acts  of  1904,  Ch.  225,  the  State  paid  50% 
of  the  cost  of  construction  of  a  road,  the  county  40%  and  abuttmg  prop- 
erty owners  10%. 

See  Bonsai  vs.  Yellott.  100  Md.,  482. 

5  Bond  issue  sale,  $251,293.50. 

6  Bond  issue  sale,  $251,496.55. 

7  Bond  issue  sale,  $1,837,916.97. 

8  Bond  issue  sale,  $942,242.19. 

9  Bond  issue  sale,  $1,002,202.05. 

See  Acts  of  1908,  Ch.  141;  1910,  Ch.  116;  1912,  Ch.  370.  (Acts  1906, 
Ch.  118,  provided  for  excess  from  lease  of  oyster  bed  to  be  used  for  special 
road  fund.     No  excess  heretofore.) 

Note. — The  fiscal  year  of  the  Comptroller  begins  in  October ;  the  fiscal 
year  of  the  Good  Roads  Commission.  April. 


386  Report  of  the  Commission 

CHA-RITIES,  BENEVOLENT. 

1911.  1912. 
Aged    Men's  and   Women's   Home   of   the 
Washington  Annual  Conference  of  Bal- 
timore  City $1,000  00  $500  00 

Baltimore  Eye,    Ear   and    Throat    Charity 

Hospital   8,000  00  8,000  00 

Baltimore  Manual  Labor  School. 3,500  00  2,000  00 

Baltimore  Humane  Impartial  Society  and 

Aged  Women's  and  Men's  Home 3,000  00  3,000  00 

Baltimore  Orphan    Asylum 3,000  00  3,000  00 

Baltimore  Day   Nursery 1,500  00  1,500  00 

Boys'  Home  Society 1,500  00  4,500  00 

Baltimore  General  Dispensary 500  00  500  00 

Confederate   Woman's    Home 1,000  00  1,000  00 

Country  Home  for  Children  of  Baltimore 

City   1,000  00             

Chase    Home 500  00         •       500  00 

Deaf  and  Dumb  Asylum  at  Frederick..  ..  33,250  00  37,000  00 

Day  Nursery  at  Hagerstown 500  00  500  00 

Emergency    Hospital   Association   of   An- 
napolis    20,000  00  20,000  00 

Emergency  Hospital  of  Easton 5,000  00  5,000  00 

Frederick  City  Hospital  Association 9,000  00  8,000  00 

Franklin  Square  Hospital  Association..  ..  7,000  00  7,000  00 
Florence     Crittenton     Home     for     Fallen 

Women 1,000  00  1,000  00 

General   German   Orphan  Asylum  of  Bal- 
timore    3,750  00  2,500  00 

General  German  Aged  People's  Home....  1.500  00  1,500  00 

General  and  Marine  Hospital,  Crisfield...  6.000  00             

Hebrew  Orphan  Asvlum 3,000  00  3,000  00 

Hebrew  Hospital  and  Asylum  Association.  8,000  00  13,500  00 

Hebrew  Friendly  Inn  and  Aged  Home...  1,500  00  1,500  00 

Home  of  the   Friendless 5,500  00  5,000  00 

Home  of  the  Incurables 2,500  00  2,500  00 

Hospital  for  the  Women  of  Maryland. .  . .  7,500  00  7,500  00 
Home    and    Infirmary   of   Western    Mary- 
land at  Cumberland 7,500  00  7,500  00 

Home  of  the   Friendless    Children   of  the 

Eastern    Shore 1,000  00  1,000  00 

Home  of  the  Aged  of  Talbot  County 3,000  00  3,000  00 

Hollywood  Children's  Summer  Home....  500  00  500  00 
Hospital  for  Crippled  and  Deformed  Chil- 
dren   5,000  00  5,000  00 

Hebrew  Children's  Sheltering  and  Protec- 
tive Association  of  Baltimore  City 3,000  00  3,000  00 

Henry  Watson   Children's  Aid  Society  of 

Baltimore    City 1,500  00  1,500  00 

Home  of  the  Aged,  Salisbury 2,500  00             

Lady  Visitors  of  the  Confederate  Soldiers' 

Home  at  Pikesville 500  00  500  00 

Little  Sisters  of  the  Poor 2,000  00             

Locust  Point  Social  Settlement 500  00  500  00 

Mercy    Hospital 13,000  00  13,000  00 

Maryland  Lying-in  Asylum,  Maternite...  4,000  00  4,000  00 

McDonough    Institute 2,000  00  6,000  00 


Cost  of  Government  in  Maryland 


387 


Maryland  General  Hospital 

Maryland  Line  Confederate  Soldiers' 
Home    

Maryland  Lying-in  Hospital,  Baltimore 
City    

Maryland  Homeopathic  Hospital  and  Free 
Dispensary    

Manual  Training  and  Industrial  School..  . 

Maryland  Home  for  Friendless  Colored 
Children    

Maryland  Society  for  Protection  of  Chil- 
dren    

Northeastern   Dispensary 

Northeastern   Day   Nursery 

Nursery  and  Child's  Hospital 

Oblate  Sisters  of  Providence 

Peninsula  General  Hospital 

Provident  General  Hospital 

St.  Anthony's  Orphan  Asylum 

St.  Vincent's  Infant  Asylum 

St.  Mary's   Female  Orphan  Asylum 

Silver  Cross  Home 

Shelter  for  the  Aged  and  Infirm  Colored 
Persons    

St.  Agnes'   Hospital 

St.  Elizabeth's  Home  of  Baltimore  City 
for  Colored  Children 

St.  Joseph's  House  of  Industry 

St.  Mary's  Home  for  Little  Colored  Boys. 

St.  Vincent's  Male  Orphan  Asylum 

South  Baltimore  Day  Nursery 

St.  Martin's    Day   Nursery 

St.  Joseph's   Hospital 

St.  Peter  Clavier  Colored  Industrial  School, 
Baltimore    City    

St.  Francis  Xavier  School  for  Deaf  and 
Dumb    

Southern  Dispensary  of  Baltimore 

St.  Martha's  Episcopal  Home 

South  Baltimore  Eye,  Ear,  Nose  and 
Throat  Charitable  Hospital 

St.  Luke's  Hospital 

University   Hospital 

United  Charities  Hospital  Association  of 
Dorchester    County 

Union  Hospital  of  Cecil  County 

Union  Protestant  Infirmary 

Universal  Progressive  School  for  Orphans 
and  Destitute  Colored  Children  of  Bal- 
timore  City 

University  of  Maryland  Lying-in  Hospital. 

Washington  County  Hospital  Association. 

West  End  Maternite  Hospital 


1911. 
13,000  00 

15,000  00 

4,000  00 

6,500  00 
15,000  00 

5,000  00 

1,000  00 

750  00 

750  00 

3,000  00 

625  00 

7,500  00 

1,500  00 

1,500  00 

6,125  00 

5,000  00 

1,500  00 


500  00 
7,500  00 

1,700  00 

3,000  00 

500  00 

5,000  00 

1,500  00 

500  00 

11,875  00 

600  00 

2,000  00 
500  00 
500  00 

2,500  00 

3,000  00 

15,250  00 

12,250  00 
5,000  00 
8,000  00 


500  00 

4,000  00 

9,000  00 

3,500  00 


1912. 
13,000  00 

15,000  00 

4,000  00 

6,500  00 
16,500  00 

5,000  00 

1,000  00 
750  00 

'3,660  00 
875  00 
12,500  00 
1,500  00 
1,500  00 
8,125  00 
5,000  00 
1,500  00 

500  00 
7,500  00 

1.700  00 
3,000  00 

500  00 
5,000  00 
1,500  00 

500  00 
10,000  00 

300  00 

2,000  00 
500  00 
500  00 

2,500  00 

3,000  00 

15,000  00 

12,500  00 
5,000  00 
8,000  00 


500  00 

4,000  00 

9,000  00 

3,500  00 


$371,925  00       $377,750  00 


388  Report  of  the  Commission 

CHARITIES,  CONSUMPTIVE. 

1911.  1912. 

Hospital  for  Consumptives  of  Maryland..          $7,500  00  $22,500  00 

Jewish  Home  for  Consumptives 3,500  00  3,500  00 

Maryland  Tuberculosis  Sanatorium 85,000  00  75,000  00 

Pine  Bluff  Sanatorium 20,000  00 

Sanatorium    Loan 175,27885  15,000  00 

$171,278  85  $136,000  00 

CHARITIES,  BLIND. 

1911.  1912. 

Indigent   Blind $21,000  00  $21,000  00 

Maryland  School  for  the  Blind  (Colored).          10,000  00  10,000  00 

Maryland  Workshop  for  the  Blind 10,000  00  10,000  00 

$41,000  00  $41,000  00 

CHARITIES,  INSANE. 

1911.  1912. 

Hospital  for  the  Negro  Insane $10,000  00  i  $26,000  09 

Insane    Convicts 2  2,400  00  3  600  73 

Lunacv  Commission  ^   4,965  49  4,759  44 

Maryland  Hospital  for  the  Insane 5  72,254  97  6i30,024  44 

Maryland    Asylum    and    Training    School 

for  Feeble  Minded  ^   58,000  00  68,000  00 

State  Insane  Hospital  Loan  §    479,638  45  124,208  00 

Springfield   State   Hospital ^  152,846  01  10241,621  93 

$780,104  92  $595,214-63 

CHARITIES— PENAL  AND  REFORM.i 

1911.  1912. 

House  of  Correction 2 $4,484  91  

House  of  Good  Shepherd 3,000  00  $3,000  00 

House    of    Good    Shepherd    (for    colored 

girls) 2,000  00  2,000  00 

House  of  Reformation  and  Institution  for 

Colored    Children 10,000  00  10,000  00 

Industrial  Home  for  Colored  Girls 3.750  00  2,500  00 

Maryland  Industrial  School  for  Girls 6,000  00  6,000  00 

Maryland  School  for  Boys 20,000  00  20,000  00 

National  Junior  Republic 3,000  00  3,000  00 

St.  Mary's  Industrial  School 30,000  00  30,000  00 

$82,234  91  $76,500  00 

1  $20,000.00  repayment  bv  counties. 

2  Repayment,  $287.50.     3  Repayment,  $89.17. 

■*  May  properlv  be  chargeable  to  administration. 
5  Repayment,  $1,254.97.     6  Repayment,  $59,024.44. 

7  Bond  issue,  $150,000.00:     Act,  1910,  ch.  250. 

8  Sale  of  l)onds  for  above  institutions  under  State  Insane   Hospital 
Loan,  $602,673.50:     Act,  1910,  ch.  250. 

9  Repayment,  $346.01.     10  Repayment,  $111,621.93. 

1  Maryland    Penitentiary   paid    to    the   State   in    1911,   $35,151.84;    in 
1912,  $25,667.68. 

2  Repayment  to  the  State,  $45,000.00  out  of  unused  appropriation. 
1  Bond  issue— Act  1910,  ch.  411. 


Cost  of  Government  in  Maryland 


389 


SCHOOLS   (GENERAL)— PUBLIC. 

19n. 

Public  school   tax $998,970  14 

Text  books,  public  schools 150,000  00 

Surplus    revenue 34,069  36 

Retired   teachers'   pension 1 24,353  00 


1912. 

$1,206,940  12 

150,000  00 

34,069  36 

26,254  98 


$1,207,392  50     $1,417,264  46 


SCHOOLS,  HIGH. 

1911. 

Approved   High    Schools $53,350  00 

Anne  Arundel  County  Academy 3,000  00 

Colleges,  Academies,  Schools : 

Allegany    County 2,400  00 

Anne    Arundel 1,200  00 

Baltimore    County 

Calvert    1,200  00 

Caroline    1.700  00 

Carroll    200  00 

Cecil    1.200  00 

Charles    400  00 

Dorchester    1.600  00 

Frederick 1,200  00 

Garrett    1.200  00 

Harford    1,500  00 

Howard    1,200  00 

Kent    500  00 

Montgomery     1,400  00 

Prince    George's 1,200  00 

Queen    Anne's 800  00 

St.    Mary's 400  00 

Somerset    1,400  00 

Talbot    1.200  00 

Washington    1.200  00 

Wicomico    1.700  00 

Worcester    1,200  00 

Charlotte   Hall   School 6,600  00 

Caroline    County    Agricultural    High    School, 

Ridgely   

Caroline  County  High  School,   Federalsburg.  .  

Frostburg  Normal  School,  for  repairs 

F    Knapp's  English  and  German  School 1.200  00 

Approved   High   Schools 53.350  00 

State   Normal   School— White 20.000  00 

State  Normal  School,  White,  renairs  of 1,000  00 

State  Normal  School  No.  3 5,000  00 

Frostburg   Normal    School •  7,000  00 

Patapsco   Academy 250  00 

St.  Mary's  Female  Seminary ^ 7,000  00 

Tri-County  High  School  at  Queen  Anne's.  ...  


1912. 


$3,000  00 

1,200  00 

1,200  00 

2,400  00 

1.200  00 

1.700  00 

200  00 

1.200  00 

400  00 

1,600  00 

1,200  00 

1,200  00 

1,500  00 

1.200  00 

300  00 

1.400  00 

1,200  00 

800  00 

400  00 

1,400  00 

1,200  00 

1.200  00 

1.700  00 

1.200  00 

6,600  00 

5,000  00 

5,000  00 

12.500  00 

1.200  00 

10,500  00 

20.000  00 

1.000  00 

5,000  00 

7,000  00 

7,000  00 
4,000  00 


$183,750  00       $214,800  00 


1  Repayment,  $50.00. 


390  Report  of  the  Commission 

SCHOOLS— COLLEGES,  ART,  TECHNICAL,   UNIVERSITY. 

1911.  1912. 

Maryland  Agricultural  Collegei 2555^397  16  3543^797  15 

Maryland   Institute 15,000  00  15,000  00 

St.  John's   College 39,700  00  29,700  00 

Johns   Hopkins   University 50,000  00  25,000  00 

Washington   College 23,275  00  23,275  00 

Western    Maryland    College 28,300  00  19,300  00 

Technical   School    Loan^ 717  65 


$211,672  16  $156,789  81 

STATE  MILITIA. 

1911.  1912. 

Fifth   Regiment  Armory $3,700  00  1  $23,593  60 

Maryland   Naval    Militia 10,000  00  10,000  00 

Militia  74,700  00  74,193  75 


$88,400  00       $107,787  35 


1  The  ]\Iaryland  Agricultural  College  receives  in  addition  the 
amount  of  license  fees  from  sale  of  commercial  fertilizers,  which 
amounted  in  1911  to  $9,945.00  and  in  1912  to  $11,760.00. 

2  Receipts  from  Maryland  Agricultural   College,  $3,478.30. 

3  Receipts  from   Maryland  Agricultural   College  in   1912,  $3,478.30. 

4  Bond  issue  of  $500,000.00  for  Johns  Hopkins  University  to  estab- 
lish Technical  School  under  Acts,  1912,  ch.  90. 

1  Alterations  for  National  Democratic  Convention,  1912. 


Cost  of  Government  in  ^^AR^'LAND 


391 


MISCELLANEOUS. 


Annapolis  Water  Company 

Anne  Arundel  County  Auditor 

Boundary  line  between  Maryland  and 
West  Virginia  (suit  United  States  Su- 
preme Court) 

Commissions  to  attorneys 

Commission  of  Criminal  Laws  - 

Extradition  of  criminals 

Interment  of  deceased  soldiers 

Ice  Boat  Annapolis 

Maryland   Historical   Society 

Maryland  State  Normal  School  Building 
Commission  ^ 

Maryland  State  Firemen's  Association.... 

Mayor  of  Annapolis 

Maryland   Manual 

Miscellaneous   appropriations 

Pensions  

Printing  sample  ballots 

Promotion  of  uniformity  of  legislation  '' 

Public   printing 

Port  Deposit  relief  fund 

Publishing  Governor's   Proclamation 

Publishing  Constitutional   Amendments... 

Publishing  list  of  defaulters 

Repairs  of  public  buildings 

Shipment  of  public  documents 

Special    appropriations 


1911. 

1912. 

$500  00 

$500  00 

30  00 

45  00 

13,617  48 

218  20 

985  50 

2,659  46 

300  00 

3  2,597  53 

4  2,072  60 

770  00 

350  00 

5,000  00 

5,000  00 

2,000  00 

2,000  00 

500  00 

4,000  00 

2,000  00 

2,000  on 

2,000  00 

1,105  10 

967  90 

399  00 

1,900  00 

600  00 

694  44 

500  00 

Hi   50 

182  45 

731  61 

2,000  00 

3,100  00 

15,000  00 

1,079  20 

20,214  60 

270  75 

4,000  00 

2,000  00 

110  35 

5,690  12 

47,929  28 

%l(>,ni   78 

$111,216  89 

1  Repayment,  $5,393.03. 

2  A  temporary  commission  to  study  the  criminal  laws. 

3  Repayment,  $51.90.     ^  Repayment,  $76.15. 

5  A  temporary  commission  to  select  a  site  and  plans  for  a  new  State 
Normal  School. 

6  A  commission  appointed  from  year  to  year. 


392 


Report  of  the  Commission 


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2  87 

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19,143  84 

6,562  28 

2,804  11 

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2,669  30 

180  34 

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1,200  00 

1,000  00 

450  00 

750  00 

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3,029  95 

1,112  95 

388  00 

1.152  00 

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Property 
Tax. 

$138,967  89 

14,237  11 

1,780  03 

1,785  77 

4,071  47 

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Assessment. 

$16,098,010  00 

2,847,422  00 

722,111  72 

274,681  00 

1.043.065  00 

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400  Report  of  the  Commission 

REPORT  ON  ACCUMULATION  AND  CONDITION  OF 
SINKING  FUNDS  FOR  STATE  LOANS  OUT- 
STANDING AT  OCTOBER  1,  1901,  AND  SEPTEM- 
BER 30,  1912.* 

This  report  was  made  from  an  examination  of  the  records  of 
the  State  Comptroller's  office  of  Maryland,  for  the  purpose  of 
ascertaining  the  provisions  which  were  made  to  meet  the  interest 
charges  and  to  create  sinking  funds  sufficient  for  the  redemption 
of  the  several  loans  outstanding  at  the  beginning  of  the  fiscal 
year  1902  (October  1,  1901)  and  those  subsequently  authorized. 

CONTENTS. 

Exhibit  "A"— Index  to  State  Loans— For  tlie  Fiscal  Years  1902  to  1912, 

Inclusive. 
"B" — Funded   Debt  of  tlie   State  of   ?*Iaryland  and  Total   Sinking 

Funds   at   the    End   of   Each    Fiscal    Year,    1902   to    1912, 

'Inclusive. 
"         "C" — Redemption    and    Cancellation    of    State    Loans    and    Parts 

Thereof— During  the  Fiscal  Years  1902  to  1912,  Inclusive. 
"         "D"— Condition    of    Sinking    Funds    and    Bonds    Outstanding— At 

October  1,  1901. 
"         "E" — Condition    of    Sinking    Funds    and    Bonds    Outstanding — At 

September  30,  1912. 
"F"— Penitentiary  3%%  Loan  of  1896 — Sundry  Provisions  for  the 

Fiscal  Years  1896  to  1907,  Inclusive. 
"G"— Insane  Asvlum  3%%  Loan  of  1896— Sundry  Provisions  for 

the  Fiscal  Years  1896  to  1906,  Inclusive. 
"H"— Consolidated  2,%  Loan  of  1899— Sundry  Provisions  for  the 

Fiscal  Years  1899  to  1912,  Inclusive. 
"         "I" — State  Building  and  Improvement  3%  Loan  of  1900 — Sundry 

Provisions  for  the  Fiscal  Years  1900  to  1912,  Inclusive. 
"J"— State   3%    Loan   of   1902— Sundry   Provisions   for   the   Fiscal 

Years  1902  to  1912,  Inclusive. 
"K"— Public  Building  2,V2%  Loan  of  1904 — Sundry  Provisions  for 

the  Fiscal  Years  1904  to  1912,  Inclusive. 
"L"— State  Roads  3%%  Loan  of  1908— Sundry  Provisions  for  the 

Fiscal  Years  1909  to  1912,  Inclusive. 
"M"— Public  Highways  4%  Loan  of  1910— Sundry  Provisions  for 

the  Fiscal  Years  1911  and  1912. 
"N"— State  Insane  Hospital  4%  Loan  of  1910— Sundry  Provisions 

for  the  Fiscal  Years  1911  and  1912. 
"O"— Sanatorium  3^/2%  Loan  of  1910— Sundry  Provisions  for  the 

Fiscal  Years  1911  and  1912. 

Baltimore,  September  20,  1913. 


*This  entire  report  was  made  to  the  Conmiission  for  the  Revision  of  the 
Taxation  System  of  Maryland  and  City  of  Baltimore  by  Suffern  &  Son, 
certified  public  accountants. 


SixKixVG  Funds  for  State  T^oans 


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414  Report  of  the  Commission 

COMMENTS. 

Exhibit  "A"  is  a  complete  index  to  all  State  loans  which  were 
outstanding  at  the  beginning  of  the  fiscal  year  1902,  or  have  since 
been  either  wholly  or  partially  issued.  On  this  exhibit  are  shown 
the  "Maturity,"  "Interest  Rate,"  "Law  Authorizing."  "Author- 
ized Date  of  Loan,"  "Issued  For,"  "Amount  Issued"  and  "Origi- 
nal Authorized  Rate  of  Levy  for  Interest  and  Redemption  Fund." 

The  item  thereon  of  "Exchange  Loan,"  $7,400.00,  represents  a 
small  balance  outstanding  at  the  beginning  of  the  fiscal  year  1902. 
We  did  not  make  an  examination  of  the  sinking  fund  records 
covering  same,  since  to  have  done  so  would  have  carried  our 
investigation  back  to  1888,  its  authorized  date  of  issue. 

On  Exhibit  "B"  will  be  found  the  amounts  of  the  various  loans 
outstanding  at  the  close  of  each  of  the  fiscal  years  1902  to  1912. 
inclusive,  and  the  totals  of  the  sinking  funds  as  at  the  same  dates. 

A  detailed  explanation  of  the  items  of  decrease  (cancellation 
and  redemption  of  bonds)  will  be  found  on  Exhibit  "C." 

A  comparison  of  the  total  funded  debt  at  the  end  of  the  fiscal 
years  1910,  1911  and  1912— Exhibit  "B"— taken  in  connection 
with  the  statement  made  on  page  9  of  the  Comptroller's  Annual 
Report  for  19.12  regarding  further  authorized  issues  of  the  State 
debt,  amounting  to  upwards  of  $5,000,000.00,  would  indicate  the 
necessity  for  an  equitable  system  of  providing  for  interest  and 
sinking  funds. 

Exhibit  "C"  covers  the  redemption  and  cancellation  of  State 
loans,  either  wholly  or  in  part,  during  the  fiscal  years  1902  to 
1912.  inclusive,  a  summary  of  which  follows: 

Redemption   $255,400  00 

Cancellation    2,639,830  50 

Total    Retired $2,895,230  50 

The  conditions  which  prevail  as  a  result  of  the  law  in  connec- 
tion with  the  cancellation  of  bonds  received  by  the  State  in  pay- 
ment for  the  sale  of  any  of  its  property  tend  to  upset  the  calcula- 
tions which  have  been  made  relative  to  sinking  funds.  Until  such 
time  as  it  will  be  impossible  for  any  tenders  of  this  nature  to  be 
made  these  conditions  must  be  met,  where  possible,  by  reductions 


Sinking  Funds  for  State  Lox'^ns  415 

in  the  amount  of  levies  commensurate  with  the  lessened  need  for 
funds  for  this  purpose. 

We  understand  that  this  point  is  covered  by  Section  3  of 
Article  12  of  the  Constitution  of  the  State,  so  that  it  would  appear 
a  difficulty  not  easily  overcome.  The  biennial  acts  of  the  Legisla- 
ture permit  of  such  changes  in  the  sinking  fund  provisions  as 
changed  conditions  demand,  and  have  much  in  their  favor,  if  the 
present  method  of  providing  for  these  funds  is  to  be  continued. 

Exhibit  "D"  shows  the  condition  of  the  sinking  funds  and  the 
bonds  of  these  loans  outstanding  at  October  1,  1901. 

The  "General  Sinking  Fund"  referred  to  thereon  was  author- 
ized, we  are  informed,  by  a  law  to  be  found  in  Bagby's  Code, 
Article  81,  Section  194,  as  follows: 

General  Sinking  Fund. 

"All  monies  remaining  in  the  Treasury  of  the  State  at  the  close 
of  each  fiscal  year,  in  excess  of  one  hundred  and  fifty  thousand 
dollars,  and  of  the  sums  required  to  meet  the  interest  accruing 
due  upon  the  public  debt,  and  the  expenses  of  the  State  govern- 
ment defined  by  law,  shall  be  held  by  the  Treasurer  of  the  State 
to  the  credit  of  the  general  sinking  fund  of  the  State,  and  shall 
be  invested  by  the  Treasurer  in  the  overdue  obligations  of  the 
State ;  and  when  the  same  are  not  procurable  in  the  obligations  of 
the  State  not  yet  matured,  or  in  the  securities  issued  by  the  United 
States,  or  in  such  other  productive  stocks  or  bonds  as  the  Treas- 
urer, the  Governor  and  Comptroller  concurring,  may  consider 
safe  and  reliable ;  and  the  sum  of  one  hundred  thousand  dollars, 
which  is  directed  to  be  set  apart  in  each  year  for  the  augmenta- 
tion of  the  sinking  fund,  may  be  invested  in  the  same  manner  and 
under  the  same  conditions  by  the  said  Treasurer ;  and  the  invest- 
ment so  made  shall  be  passed  to  the  credit  of  the  sinking  fund." 

In  this  connection  it  should  be  noted  that  there  are  now  no 
"General"   bonds    outstanding   for    which    this    sinking    fund   is 

required. 

Exhibit  "E"  shows  the  condition  of  the  sinking  funds  and  the 
bonds  of  these  loans  outstanding  at  September  30,  1912,  the  de- 
tails of  which  are  hereinafter  more  fully  discussed  under  the  head 
of  their  respective  funds. 


416  Report  of  the  Commission 

General  Sinking  Fund— Exhibit  "E"— $159,000.00. 

This  item  represents  a  contingent  provision  for  any  deficiency 
in  the  amount  of  sinking  funds  provided  to  meet  maturing  loans, 
there  being,  as  previously  stated,  no  "General"  bonds  outstanding 
at  September  30,  1912. 

Penitentiary  31/2'^  Loan  of  1896— Exhibit  "F"— $500,000.00. 

Cancelled.  1906 ■ $252,000  00 

Redeemed,    1907 248.000  00 

$500,000  00 

This  loan  was  authorized  by  Chapter  166  of  the  Laws  of  1896. 
By  the  terms  of  the  law  i%6  of  one  cent, on  each  $100.00  was  to 
be  levied  in  1897  and  annually  thereafter  to  meet  the  interest 
and  to  create  a  sinking  fund  for  the  redemption  of  the  said  loan. 
Levies  at  the  rate  of  i%6  oi  one  cent  on  each  $100.00  were  made 
in  1897,  1898  and  1899.  In  1900  the  law  was  amended  and  %  of 
one  cent  on  each  $100.00  was  directed  to  be  levied  for  the  years 
1900  and  1901.  The  law  was  again  amended  in  1902  and  a  rate 
of  Yo  of  one  cent  on  each  $100.00  was  directed  to  be  levied.  This 
amount  was  accordingly  levied  for  the  years  1902  and  1903.  In 
1904  the  amount  directed  to  be  levied  for  the  years  1904  and  1905 
and  annually  thereafter  was  i/^  of  one  cent  on  each  $100.00, 
which  amount  was  accordingly  levied  for  the  years  1904,  1905 
and  1906. 

On  April  27.  1906,  bonds  of  this  loan  aggregating  $252,000.00 
were  received  by  the  State  in  part  payment  for  its  stockholdings 
in  the  Washington  Branch  of  the  Baltimore  and  Ohio  Railroad 
Company,  and  this  portion  of  the  loan  was  accordingly  cancelled. 
As  a  result  the  sinking  fimd  was  $236,000.00  in  excess  of  require- 
ments at  August  31,  1907,  represented  by  the  following  bonds 
at  par : 

Consolidated   Loan  of  1899 $80,000  00 

State  Building  and  Improvement  Loan 126,000  00 

Public   Buildings    Loan 30,000  00 

lotal  as  above $236,000  00 

These  bonds  were,  therefore,  transferred  to  the  sinking  funds 
f)f  their  respective  loans  on  August  31,  1907,  as  was  also  an  item 


Sinking  Funds  for  State  Loans  417 

of  $1,485.00  cash,  which  was  placed  to  the  credit  of  the  State 
loan  of  1902. 

The  last  bonds  of  the  Penitentiary  loan  were  redeemed  Sep- 
tember 13,  1907. 

The  conditions  disclosed  in  connection  with  the  over-provision 
for  the  retirement  of  this  loan  seem  inevitable  under  the  present 
laws. 

Attention  is  directed  to  the  column  headed  "Collections  on 
Account  of  this  Loan."  The  figures  shown  therein  represent  tax 
receipts  from  collectors,  incorporated  institutions  and  Baltimore 
City  stock,  and  are  applicable  to  interest  on  the  loan  and  to  pro- 
vide a  fund  to  redeem  the  bonds  at  maturity. 

The  "Interest  on  Securities  Held"  in  the  sinking  fund  is  not 
included  in  these  "Collections." 

This  fact  should  be  borne  in  mind  in  a  study  of  the  Exhibits 
"F"  to  "O,"  inclusive. 

Insane  Asylum  31/2%  Loan— Exhibit  "G"— $100,000.00. 
Cancelled,  1906 $100,000  00 

An  inspection  of  Exhibit  "G"  illustrates  the  difficulties  which 
are  encountered  in  providing  sinking  funds  under  existing  laws. 
The  entire  amount  of  this  loan  was  cancelled  on  April  27,  1906, 
same  having  been  received  from  the  Maryland  Trust  Company 
in  part  payment  for  the  State's  holdings  in  the  Washington 
Branch  of  the  Baltimore  and  Ohio  Railroad  Company.  (See 
Comptroller's  Report  for  the  fiscal  year  ended  September  30, 
1906.)  The  securities  and  cash  in  this  sinking  fund  at  that  date 
were  consequently  available  for  and  were  transferred  to  other 
sinking  funds. 

The  average  annual  provision  which  was  made  for  this  sinking 
fund  was  slightly  in  excess  of  its  requirements,  based  upon  a  ten- 
year  maturity  of  the  bonds,  but  all  calculations  were  upset  when 
the  entire  issue  of  these  bonds  was  turned  over  to  the  State  before 
maturity  and  without  cost  to  the  sinking  fund  of  that  loan. 

Consolidated  3?o  Loan  of  1899— Due  1914. 

Outstanding  September  30,  1912— Exhibit  "E".  .  .   $3,191,095  63 
Sinking  Fund  September  30,  1912— Exhibit  "H".  .     3,111,112  15 


418  Report  of  the  Commission 

The  sinking  fund  consisted  of : 

Securities   $3,060,978  82 

Cash    ■ 50,133  33 

Total   $3,111,112  15 

The  interest  earnings  on  the  securities  held  in  this  fund  will  be 
more  than  sufficient  to  provide  the  additional  sum  necessary  to 
retire  these  bonds  at  maturity. 

A  portion  of  the  interest  charge  will  probably  be  taken  care  of 
through  Treasury  cash,  since  it  is  unlikely  that  any  appreciable 
amount  of  collections  will  be  made  for  this  purpose,  no  levy  hav- 
ing been  made  since  1906. 

The  manner  in  which  this  sinking  fund  was  accumulated  and 
other  data  in  connection  therewith  are  set  forth  on  Exhibit  "H," 
an  inspection  of  which  discloses  the  fact  that  $729,905.46  of  the 
total  of  $3,111,112.15  was  derived  from  "Transfers"  from  the 
sinking  funds  of  the  loans  which  have  either  been  redeemed  or 
cancelled.    This  item  of  $729,905.46  represents : 

Bond    Transfers $99,000  00 

Cash  Transfers 473,580  46 

$572,580  46 
Sale   of    State    Securities    not    in    Sinking   Funds 

(Chesapeake  &  Ohio  Canal  Stock) 157,325  00 

Total $729,905  46 

While  this  indicates  an  over-provision  for  those  loans  from 
which  these  transfers  were  made,  in  some  of  the  cases  this  was 
due  to  the  acceptance  by  the  State,  under  the  law,  of  bonds  in 
payment  for  assets  which  it  sold,  a  condition  which  we  have  com- 
mented upon  elsewhere  in  this  report. 

During  the  period  1899  to  1912,  inclusive,  security  holdings  of 
this  fund  aggregating  $118,000.00  were  redeemed  at  par,  which 
was  the  figure  at  which  they  were  being  carried,  consequently  no 
adjustments  in  the  amount  of  the  fund  were  required. 

The  inequality  of  provision  during  the  several  years,  as  shown 
in  the  column  headed  "Total  Provision,"  is  one  of  the  concomi- 
tants of  the  present  system  which  apparently  can  only  be  over- 
come by  changes  in  the  existing  laws. 


Sinking  Funds  for  State  Loans  419 

State  Building  and  Improvement  37o  Loan  of  1900— $500,000.00. 

Sinking  Fund  September  30,  1912— Exhibit  "I".  .  .  .   $488,724  50 

This  exhibit  emphasizes  the  inequalities  of  the  present  method 
of  providing  for  sinking  funds  and  covers  the  period  from  the 
issue  of  the  loan  to  September  30,  1912.  In  a  single  year — 1901 — 
$100,000.00,  or  one-fifth  of  the  total  amount  of  the  loan,  was 
set  aside  for  a  sinking  fund  provision,  although  it  represented 
collections  for  the  fiscal  years  1900  and  1901.  The  difficulty  in 
this  case  seems  to  have  been  in  levying  a  sum  out  of  all  propor- 
tion to  the  needs  of  the  sinking  fund.  An  attempt  to  correct  this 
was  later  made  by  levying  a  smaller  amount. 

After  the  transfer  to  this  fund  in  1906  and  1907  of  bonds 
aggregating  $159,000.00  from  the  Insane  Asylum  and  Peniten- 
tiary loans,  there  existed  no  need  for  further  levies  and  none  has 
since  been  made. 

The  amount  in  this  fund  will  be  more  than  sufficient  to  retire 
these  bonds  at  maturity. 

State  3%  Loan  of  1902. 

Outstanding  September  30,  1912— Exhibit  "E,".  .  .  .  $600,000  00 
Sinking  Fund  September  30,  1912— Exhibit  "J".  .  .  .     430,000  00 

The  early  collections  for  account  of  this  loan  were  in  excess 
of  requirements,  and  in  addition  there  were  transfers  to  this  fund 
of  bonds  amounting  to  $117,000.00  and  cash  $1,755.00  in  1906. 
As  a  consequence,  the  amount  provided  up  to  that  date  was 
largely  in  excess  of  the  amount  required,  and  no  levies  for  the 
fund  have  since  been  made. 

Some  further  provision,  however,  must  be  made  to  complete 
the  amount  which  will  be  needed  to  retire  the  loan  at  its  maturity 
in  1917. 

Public  Buildings  3|/2%  Loan  of  1904. 

Outstanding  September  30,  1912— Exhibit  "E".  .  .   $1,618,000  00 
Sinking  Fund  September  30,  1912— Exhibit  "K".  .        708,000  00 

This  loan  was  originally  $1,625,000.00,  but  was  reduced 
$7,000.00  in  1912,  bonds  for  this  amount  having  been- presented 
in  part  payment  for  the  State's  holdings  of  Farmers'  National 
Bank  of  Annapolis  stock  and  accordingly  cancelled. 


420  Report  of  the  Commission 

The  first  levies  for  this  sinking  fund  were  in  excess  of  require- 
ments and  they  were  subsequently  reduced.  In  1906  bonds  and 
cash  aggregating  $38,140.00  were  transferred  to  this  fund  from 
the  Insane  Asylum  and  Penitentiary  loans,  and  thereafter  no 
levies  were  made  until  the  current  year.  The  present  rate  of 
.01  on  each  $100.00  will  probably  have  to  be  increased  slightly  in 
order  that  there  may  be  sufficient  funds  provided  to  retire  the 
loan  when  it  falls  due  in  1919. 

State  Road  3|/2%  Loan  of  1908  at  seq. 

Outstanding  September  30,  1912— Exhibit  "E".  .  .   $4,490,000  00 
Sinking  Fund  September  30,  1912— Exhibit  "L".  .        700,000  00 

Four  million  five  hundred  thousand  dollars  of  these  bonds  had 
been  issued  as  at  September  30,  1912,  of  which  $10,000.00  were 
cancelled  in  1912,  as  the  result  of  their  being  received  in  payment 
for  the  State's  interest  in  $35,000.00  of  stock  of  the  Philadelphia 
and  Baltimore  Central  Railroad  Company. 

Levies  for  account  of  this  sinking  fund  have  l^een  made  as 
follows : 

1909  02      on  each  $100.00 

1910'  ■  "  031/2  on  each  $100.00 

1911  ■  ■  ■  041/2  on  each  $100.00 

1912'  051/2  on  each  $100.00 

1913 OSVa  on  each  $100.00 

These  levies  have  so  far  provided  amounts  in  excess  Of  the 
needs  of  the  sinking  fund,  and  it  would  seem  that  they  will  con- 
tinue to  do  so,  notwithstanding  the  fact  that  at  September  30. 
1912,  there  were  yet  to  be  issued  $500,000.00  of  these  bonds. 

The  amounts  necessary  to  be  set  aside  and  invested  yearly  at 
31/2%  for  a  period  of  fifteen  years  to  produce  $5,000,000.00  and 
the  yearly  interest  charges  on  each  series  are  as  follows : 

Yearly  Yearly 

Sinking  Fund  Interest 

Series.                    Amount.         Provision.  Charge.  Total. 

"A"                   $500,000  00       $25,912  54  $17,500  00  $43,412  54 

'•B"    '    '                           1.000.000  00         51,825  08  35,000  00  86,825  08 

"C"    1,000,000  00         51,825  08  35.000  00  86.825  08 

"D"   1,000,000  00         51,825  08  35,000  00  86.825  08 

"E"    1 000,000  00         51,825  08  35,000  00  86,825  08 

"F"   .'.'.'.'.'.'.'.'.".'.".'.'.".'       500,00000         25,91254  17,50000  43,41254 

Totals    $5,000,000  00     $259,125  40     $175,000  00     $4.34,125  40 


Sinking  Funds  for  State  Loans  421 

Tlie  total  yearly  provision  for  the  entire  issue  of  five  million 
dollars  ($5,000,000.00)  is  shown  to  be  $434,125.40,  while  for  the 
fiscal  year  ended  September  30,  1912,  w-ith  Series  "F"  unissued, 
there  were  "Collections"  and  "Interest  Earnings"  available  for 
this  purpose  aggregating  $539,195.87,  or  about  $149,000.00  in 
excess  of  the  amount  then  required. 

Bonds  of  this  loan  to  the  amount  of  ten  thousand  dollars 
($10,000.00)  have  been  cancelled  (Exhibit  "C"),  but  in  view  of 
the  slight  difiference  which  this  makes  in  the  necessary  yearly  pro- 
visions this  fact  has  been  purposely  ignored  in  the  foregoing 
illustration. 

An  inspection  of  Exhibit  "L"  will  show  that  there  were  collec- 
tions for  account  of  this  loan  during  the  years  1909  to  1912, 
inclusive — 

aggregating   $1,332,198  17 

Add  Interest  Earnings 27,160  00 

Total  Available  for  Interest  and  Sinking  Fund $1,359,358  17 

Deduct  Yearly  Interest  Payments 289,310  00 

Balance  Available  for  Sinking  Fund $1,070,048  17 

There  has  been  Transferred  to  the  Sinking  Fund 662,210  47 

Balance  Available  for  Transfer $407,837  70 

Adding  the  "Total  Provision"  thus  far  made,  viz 700,000  00 

The  amount  of  the  Sinking  Fund  would  be $1,107,837  70 

It  will  be  noted  that  there  is  a  "Balance  Available  for  Trans- 
fer" to  this  sinking  fund  of  $407,837.70.  It  has  been  the  general 
practice  to  transfer  to  sinking  funds  only  such  sums  as  were  re- 
quired to  make  up  the  amount  which  it  was  decided  should  be 
invested  each  year  in  securities,  generally  in  bonds  of  the  State. 
The  difference  between  the  amounts  transferred  and  the  balance 
available  for  transfer  remain  in  the  Treasury  proper,  but  are 
therein  distinguished,  as  may  be  seen  by  referring  to  the  Comp- 
troller's Annual  Report  for  the  fiscal  year  1912,  page  7. 

Public  Highways  47^  Loan  of  1910. 

Outstanding  September  30,  1912— Exhibit  "E"....   $500,000  00 
Sinking  Fund  September  30.  1912— Exhibit  "M".  .  .       35,000  00 

Only  $500,000.00  of  these  bonds  had  been  issued  at  September 
30,  1912,  although  $500,000.00  additional  had  been  authorized. 


422  Report  of  the  Commission 

The  proportionate  amount  set  aside  for  sinking  fund  thus  far 
is  less  than  it  should  have  been.  After  the  Series  "C"  and  "D" 
have  been  issued,  it  will  require  the  annual  setting  aside  and 
investment  at  4%  of  $49,941.10  for  fifteen  years  to  provide  a 
sinking  fund  with  which  to  retire  these  bonds  at  maturity.  In 
addition  there  would  then  be  an  annual  interest  charge  of 
$40,000.00.  making  a  total  yearly  provision  of  $89,941.10. 

State  Insane  Hospital  47f  Loan  of  1910. 

Outstanding  September  30,  1912— Exhibit  "E".  ..  .   $600,000  00 
Sinking  Fund  September  30,  1912— Exhibit  "N".  .  .  .      60,000  00 

The  rates  of  levy  to  provide  for  interest  and  sinking  fund  for 
this  loan  have  been  excessive,  in  view  of  the  fact  that  there  is  an 
annual  interest  charge  of  $24,000.00  and  that  the  setting  aside 
annually  of  $29,964.66  invested  at  4%  will  produce  $600,000.00 
at  the  end  of  fifteen  years.  This  would  call  for  the  yearly  col- 
lection of  $53,964.66.  whereas  the  average  yearly  collection  for 
the  years  1911  and  1912  as  shown  by  Exhibit  "N"  was  approxi- 
mately $86,000.00. 

The  1913  levy  is  25%  less  than  it  was  for  the  years  1911  and 
1912,  the  intention  evidently  being  to  bring  the  collections  and 
requirements  to  about  the  same  figure. 

Sanatorium  3J/2'a  Loan  of  1910. 

Outstanding  September  30.  1912— Exhibit  "E".  ....   $40,000  00 
Sinking  Fund  Septeml)er  30,  1912— Exhibit  "O".  . .  .      10.000  00 

There  were  $100,000.00  of  these  bonds  issued,  but  $60,000.00 
of  them  were  cancelled  as  a  result  of  their  being  received  in  part 
payment  for  the  State's  holdings  of  stock  in  the  Annapolis  Water 
Company,  leaving  $40,000.00  outstanding  at  September  30.  1912. 
For  this  reason  the  sinking  fund  provision  at  that  date  is 
abnormal. 

Receipts  for  interest  and  sinking  fund  for  the  fiscal  year  1912 

amounted    to.. $21,505  93 

Interest  Requirements   were 2,450  00 

Leaving  applicable  to  Sinking  Fund ;••:••      $19,055  93 

Of  this  amount  there  has   been  paid  for  account  of  Sinking 
Fund   9.998  34 

Leaving  still   available *    $9,057  59 


Sinking  Funds  for  State  Loans  423 

This  indicates  a  need  for  about  $20,000.00  to  be  added  to  this 
fund  during  the  lifetime  of  the  loan,  a  portion  of  which  will  be 
supplied  by  interest  earnings  on  the  amount  invested  therein.  No 
levy  for  account  of  this  loan  was  made  in  1913. 

The  following  loans  of  1912  were  first  levied  for  in  1913: 
State  4%  loan  for  State  Roads,  Technical  School  4%  loan  and 
the  Maryland  State  Normal  School  4%  loan.  Exhibits  relative  to 
these  sinking  funds  are  therefore  omitted. 

In  several  of  the  annual  reports  of  the  Comptroller  there  oc- 
curs a  statement  relative  to  sinking  funds  as  follows :  "The  integ- 
rity of  these  funds  has  been  absolutely  maintained  during  the 
years  — ■ — ."  While  this  is  true  so  far  as  the  Comptroller  is  con- 
cerned, there  has  nevertheless  been  a  very  uneven  provision  made 
for  this  purpose,  as  a  study  of  the  column  headed  "Collections  on 
Account  of  this  Loan"  on  Exhibits  "F"  to  "O"  of  this  report  will 
disclose.  Instead  of  levying  such  a  rate  as  will  in  a  few  years 
produce  sufficient  funds  to  retire  a  loan  at  maturity  and  then  dis- 
continuing levies  altogether,  the  better  practice  would  be  where 
possible  to  levy  at  a  rate  which  would  produce  about  the  same 
amount  annually  for  the  lifetime  of  the  loan. 

It  is  also  to  be  noted  that  collections  on  account  of  loans  con- 
tinue long  after  the  loans  have  been  cancelled  or  redeemed.  For 
example :  The  Insane  Asylum  loan  was  cancelled  April  27,  1906, 
and  the  balance  of  the  Penitentiary  loan  redeemed  during  1906, 
whereas  collections  for  account  of  these  loans  had  not  ceased  at 
September  30,  1912. 

In  our  opinion,  the  period  for  which  State  loans  are  issued 
should  be  materially  lengthened,  in  order  that  the  burden  of  inter- 
est charges  and  sinking  fund  provision  may  be  borne  by  those  for 
whose  benefit  the  bonds  are  issued.  As  now  handled,  the  present 
taxpayers  are  carrying  a  portion  of  the  burden  which  should  fall 
upon  their  successors  in  interest  from  twenty  to  fifty  years  hence. 
Investigation  of  the  practice  in  this  connection  in  other  advanced 
Commonwealths  will  show  that  it  is  the  exception  rather  than  the 
rule  to  retire  State  bonds  in  such  short  periods  as  has  been  the 
custom  in  the  State  of  Maryland. 

It  has  been  suggested  that  many  of  the  difficulties  which  are 
inherent  in  the  present  method  of  providing  for  the  interest 
charges  and  sinking  funds  for  State  loans  would  be  overcome  by 


424  Report  of  the  Commission 

the  inauguration  of  a  system  for  retiring  such  loans  by  equal  an- 
nual payments.  In  view  of  the  comparative  simplicity  of  the 
"instalment  payment"  idea,  and  the  fact  that  there  would  be  in 
all  probability  little  difference  to  the  State  in  the  amounts  realized 
from  the  sale  of  such  obligations  as  compared  with  those  now 
being  issued,  the  suggestion  is  one  which  might  well  be  consid- 
ered. In  addition  to  other  advantages,  there  would  be  a  direct 
saving  to  the  taxpayers  through  the  issuance  of  the  instalment 
bonds,  since  the  net  cost  of  bonds  issued  under  this  plan  would 
be  less  than  is  paid  under  the  present  method  of  making  sinking 
fund  provisions,  due  to  the  fact  that  it  is  not  always  possible  to 
promptly  invest  the  sinking  funds  at  full  rates. 

It  has  also  been  suggested  that  the  State  tax  levy  should  be  a 
general  one,  and  that  from  the  amounts  collected  there  should 
be  each  year  appropriated  certain  specified  sums  to  provide  sink- 
ing funds  with  which  to  redeem  outstanding  loans.  This  plan 
has  much  to  recommend  it,  although  it  is  not  as  simple  in  opera- 
tion as  the  "instalment  payment"  plan,  from  which,  once  it  is 
inaugurated,  there  would  be  no  chance  for  deviation,  since  the 
annual  instalments  would  have  to  be  paid  as  they  fell  due. 

The  assessed  value  of  property  for  the  State  tax  levies,  the 
yearly  per  cent,  of  increase  or  decrease  in  this  item,  and  the 
State  tax  rate  for  the  fiscal  years  1896  to  1913,  inclusive,  follow: 

Approximate  State  Tax 

Amount  Yearly  Rate  per 

Fiscal  of  Assessed  Increase  or  .  $100. 

Year.  Valuation.  Decrease.  (Cents.) 

1896 $540,461,747                17% 

1897 607.965,272  1249/ioo%  17% 

1898 603,326.096  ^%oo%*  17% 

1899 •. 611.539,646  136/ioo%  17% 

1900 616,719,782  §5/^00%  17% 

1901 643,812.408  4-'%oo%  17 

1902 668.857,803  ?>^%oq%  17 

1903 673,378,299  »7ioo%  17 

1904 680,743,794  li%oo%  22V2 

1905 705,561,456  2,^^Aoo7o  23y2 

1906 738,726,161  4'i/ioo%  231/2 

1907 765,109,228  2>mm%  16 

1908 794,929,222  399ioo%  16 

1909 820,831,339  2>mQQ%  16 

1910 836,665,067  l»%oo%  16 

1911 951.926.271  W^Vxm^o  22 

1912 979,309,976  288/ioo%  23^/4 

1913 Not  available           31 

Note. — These  figures  do  not  include  incorporated  institutions  or  Balti- 
more City  stock. 
*Decrease. 


Sinking  Funds  for  State  Loans  425 

The  ])cr  capita  net  debt  of  tlie  State  for  the  years  1900.  1910 
and  1912.  using  the  Federal  census  figures  for  1900  and  1910 
and  assuming  a  corresponding  increase  for  the  two  years  to  1912, 
was  as  follows : 


1900 $4  23 

1910 2  17 

1912 5  55 


With  the  issue  of  the  $5,081,000.00  additional  authorized  debt 
referred  to  in  the  Comptroller's  Report  for  1912,  the  per  capita 
net  debt  will  probably  be  upwards  of  $9.00.  a  marked  increase 
over  the  year  1910. 

The  per  cent,  of  interest  and  sinking  fund  pravisions  of  the 
total  State  tax  levy  for  the  fiscal  years  1900  to  1912,  inclusive, 
follows : 


1900 295%oo% 

1901 26^%oo% 

1902 28% 

1903 28% 

1904 25S'/ioo% 

1905 28'%oo% 

1906 2872ioo% 

1907 None  I  , 

1908 None  I  ^°'^ 

1909 12y2% 

1910 2188/100% 

1911 267/10% 

1912 30«-yioo%— High 

The  per  cent,  of  sinking  funds  to  State  debt  at  the  end  of  each 
of  the  fiscal  vears  1902-1912,  inclusive,  was  as  follows: 


1902 285'yioo%— Low 

1903  33%oo% 

1904 33^yioo7o 

1905 38'-/ioo% 

1906 60«y]oo% 

1907 64%oo% 

1908 678->ioo7o— High 

1909 6625/100% 

1910 62'%oo% 

1911 49"/ioo% 

1912 437yioo% 


426  Report  of  the  Commission 

The  per  cent,  of  the  net  debt  of  the  State  to  the  assessed  value 
of  property  for  State  taxes  for  the  years  1896  to  1912  was  ap- 
proximately as  follows : 

1896 1%— High 

1897 83/^00% 

1898 ■^%oo% 

1899 "^8/^00% 

1900 81/^00% 

1901 "^^loo^o 

1902 ■^Moo% 

1903 "^1/100% 

1904 '^%oo% 

1905 "^4/100% 

1906 3%jjo% 

1907 28/^00% 

1908 25/^00%— Low 

1909 ~^/xwi% 

1910..... 34/^00% 

1911 57/^00% 

1912 75/^00% 


INDEX. 


Page. 

Accumulations  of  the  sinking  funds 49, 

50,  51,  52,  53,  400,  423,  424 
Administrators,  tax  on  (sec  Executors.) 

Affidavits,  as  to  consideration  in  deeds 41 

Alabama     3<>, 

296,  312,  317,  318,  341,  344,  345,  850,  365,  366 

Alienation   lists 61 

Allegany  County  : 

Assessment   in 73-207 

Assessors   in   1910 '.  .        215 

bonded   indebtedness 327 

Cities,   towns  and  villages  of 328-394 

Collection   of   taxes 220, 

222,  223,  224,   231,  240 

Cost   of   reassessment   1910 214 

Fiscal  year  begins 232 

Levy   for  schools 367 

Licenses    354,  358,  361 

Per  capita  cost  of  government 393 

Receipts,  from  all  sources 393 

Tax  rates 393 

Taxable  basis  since  1877 180 

Anne  Arundel  County  : 

Assessment  in 77 

Assessors  in   1910 215 

Bonded  indebtedness 327 

Cities,  towns  and  villages  of 328-394 

Collection    of   taxes 220, 

222,  223,  224,  231,  241 

Cost  of  reassessment  1910 214 

Fiscal   year  begins 232 

Levy,   for  schools 367 

Licenses    354,   358,  361 

Per  capita  cost  of  government 393 

Receipts  from   all   sources 393 

Tax    rates 393 

Taxable  basis  since  1877 181 

Appeal  Tax  Court  of  Baltimore  City  : 

Establishment    of 169 

(See  Baltimore  City.) 

Arizona 10, 

297,  312,  317,  318,  341,  365 

Arkansas    10, 

296,   312,  317,   318,   365 

Assessed  Valuation  : 

Of  State,   for  taxation 205 

Includes    what 169 


428  Index 

I'agp. 

Assessing  Units  : 

Under  Act  of   1910 I  7  4 

Assessment   books tiO 

Assessment : 

Compared  witli  valuation    (see  each  county). 

Counties  for  State  purposes,  from  1877-1912 180-206 

Farms     58 

Method    57 

Personal    property 65 

Railroad    property 66 

Shares    of    Corporations 267,  268,   273 

Summary  of  contrasts  in  Maryland 13 

Systems   in   Maryland 11 

Town    property 15,  59,  68,  270 

Assessors  : 

Duty   of 58 

Number  employed  in  1910 2l5 

Occupation    of 215 

Permanent    (see  each   county). 

Automobiles,  Taxation  of  : 

See  "Assessment  in   Maryland"    (see  each  county). 
See  also  "Licenses." 

Baltimore  City  : 

Assessment  in 14,    71,   81,  207 

Bonded    indebtedness 327 

Collection    of   taxes 220, 

222,   223,   224,   231,  242 

Cost  of  reassessment  in  1896 214 

Expenditures   in    1912 81-393 

Fiscal  year  begins 232 

Legislation    concerning 170 

Levy    for   schools 367 

Licenses   354,  358,  361 

Liquor   licenses 358,   359,  381 

Per  capita  cost  of  government 393 

Receipts   from   all    sources 393 

Report  of  Advisory  Committee    (1907) 82,   83,  170 

Securities     308 

Status  same  as  county 17i 

Tax    rates .  393 

Tax  paid  by  banks  in 25 

Taxable  basis  since  1877 183 

Taxation  of  Baltimore  City  stocks 325-326 

Baltimore  City  Stock  : 

Deductions  allowed  in   assessing  shares  of  stock 268-296 

Taxation    on 325,    326,    380 

I'.altimore  County  : 

Assessment  in 58,  88,  207 

Assessors    in    1910 215 

CoUiclion    of    taxes 220. 

222    223    224    231    24.3 

Cost   of  reassessment,    lit  in 214 

FMscal    year    begins 232 

Levy    for   schools 367 

Licenses    354,  358,  361 


Index  429 

Per  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax    rates 393 

Taxable  basis  since  1877 184 

Banking  condition   in   Maryland 287 

Banking  resources 289 

Banks : 

Number  of  national  banks  in  10  Eastern  States 28Q 

Conclusions  of  commission  on  present  method  of  taxing 24,  25,  26 

Taxation  of  shares  of  stock  of  bank 285 

Taxation  methods,  rates  and  deductions 298,  299.  300 

Bonus   tax 21,   275 

Boston  : 

Tax  paid  by  banks  in 25 

See  also  289,  290,  291,  292,  298. 

Bullock,  Charles  J. 

Maryland's    securities    tax 306 

California    41 

286,  294,  297,  312,  317,  318,  341,  365 

Calvert  County  : 

Assessment    in 13, 

28,  94,  207.  310 

Assessors   in    1910 215 

Bonded    indebtedness 327 

Cities,  towns  and  villages  of 328,  394 

Collection    of   taxes 220, 

222,  223,  224,  231,  244 

Cost  of  reassessment,   1910 214 

Fiscal   year   begins 232 

Levy   for   schools 367 

Licenses    354,  358,  361 

Per  capita  cost  of  government 393 

Receipts   from   all   sources 393 

Tax    rate 393 

Taxable   basis  since  1877 185 

Capital  Stock  : 

Right  to  tax  the  capital  stock  of  corporations 339 

Caroline  County  : 

Assessment     in 1."!, 

28,  58,  97,   207,  310 

Assessors   in    1910 21."> 

iBonded    indebtedness 327 

Cities,   towTis  and  villages  of ' 328-394 

Collection    of   taxes .  220, 

222,  223,  224,   231,  245 

Cost  of  reassessment,   1910 21  ( 

Fiscal  year  begins 232 

Levy   for   schools 367 

Licenses    354,  358,   361 

Per  capita  cost  of  government 393 

Receipts  from   all    sources 393 

Tax    rates 393 

Taxable  basis  since  1877 ISi; 


430  Index 

Page. 
Carroll  County  : 

Assessment  in 14,  101,  2U7 

Assessors   In   1910 215 

Bonded    indebtedness 327 

Cities,  towns  and  villages  of 328-395 

Collection    of    taxes 220, 

222,  223,  224,  231,  246 

Cost  of  reassessment,   1910 214 

Fical   year   begins 232 

Levy   for  schools 367 

Licenses   354,  358,   361 

Per  capita  cost  of  government 393 

Receipts   from   all   sources 39."! 

Tax    rates 393 

Taxable  basis  since  1877 187 

Cecil  County : 

Assessment  in 13,   106,   207,   212 

Assessors  in   1910 215 

Bonded    indebtedness 327 

Cities,  toWns  and  villages  of 329-395 

Collection    of   taxes 220. 

222,  223,   224,   231,   247 

Cost  of  reassessment,   1910 ^ 214 

Fiscal  year  begins 232 

Levy   for  schools 367 

Licenses   354,   358,  361 

Per  capita  cost  of  government 393 

Receipts   from   all   sources 393 

Tax    rates 393 

Taxable  basis  since  1877 188 

Centralization  of  taxing  authority 9,   10,  54,  55 

Certificates  of  indebtedness 27-305 

Charitable   Institutions  : 

Appropriations   for 40 

Bequests    to 315-316 

Charities  : 

Cost  of 386,  387,  388 

Charles  County : 

Assessment   in 110-207 

Assessors   in    1910 215 

Bonded    indebtedness 3z7 

Cities,  towns  and  villages  of 329-395 

Collection    of   taxes ; 220, 

222,  223,  224,  231,  248 

(.  ost  of   reassessment,   1910 214 

Fiscal   year  begins 232 

Levy   for   schools 367 

Licenses    354,  358,  361 

Per  capita  cost  of  government 393 

Receipts   from   all   sources 393 

Tax    rates 393 

Taxable  basis  since  1877 189 

Chicago  : 

Tax  paid  by  banks  in 25 

See  289,  290,  291,  292,  298. 


Index  431 

Pago. 
Cities,   Towns  and  Villages  : 

Local  taxation  of  corporations 270 

Reassessment  for  municipal  purposes 171 

Civil  Commissions : 

Tax    on .'!<; 

Classification  of  propertj' 27,  35,  58 

Clearing  Houses  : 

Business    of 290 

Clerk  to  county  commissioners,  also  collector  of  taxes 227,  231 

Cleveland  : 

Tax  paid  by  banks  in 25 

See  289,  290,  291,  292,  298. 

Coal  : 

Taxation    of 336, 

337,  338,  339,  341 

Collateral  Inheritance  Taxes  : 

(See  Inheritance  Taxation.) 

Collection  of  Taxes  : 

Aggregate  for  10  years 223-224 

Changes  in  method  of 217-21S 

Commission    paid    for 226, 

228,  229,  230,  231 

Corporation  and  fee  officers 17 

Cost   of 229 

Discount  system  of  collectors 227 

For  loans  in  excess  of  requirements   (see  Sinking  Funds). 

In    1912 225-226 

Method    of 227 

Percentage  of 220,  221.  222 

Recommendation   of  the   Commission 15,  16,  17 

Table  showing,  in  all  the  counties  from  1902-1912 240-263 

Collectors  of  Taxes  : 

Number  of,  in  the  counties 16-227 

Colorado    10, 

297,   312,  318,   341,   365 

"Commissioners  of  the  tax  for  the  county" 219 

Commission  to  Administrators  and  Executors  : 

Tax    on 316 

Commission   of  1888  : 

Personnel    170-note  13 

("omparsion   of  reassessments  of  1877,   1896,    1910 176-177 

Connecticut    29, 

44,  45,  296,  312,  317,  344,  345,  365 

Conservation  Congress   (4th  national)   on  "taxation  of  forests" 345 

Consolidated   Loan   of  1899  : 

Comments    53,   417-418 

Data    408 

Levies     47 

Constitution  of  Maryland,  Article  XV  of  Bill  of  Rights 35 

Corporate  excess  taxation,  objection  to 2T1 


432  Index 

Page. 
Corporations  : 

Assessment  of  shares  of 17, 

19,  265,  266,  267,  271,  272,  273 

Bonus  tax  or  organization  tax 21-275 

Changes  in  the  law  for  taxation  of 260 

Deductions  allowed  in  assessing  shares 268-296 

Diflferences  in  method  of  taxation  of  domestic  and  foreign 265 

Domestic  ;   valuation  of  shares 17, 

19,  265,  266,  267,  271,  272,  273 

Entrance  fees   of   foreign 279 

Foreign    2.1, 

23,  265,  275,  276,  277,  278.  279 

Franchise  tax  on  foreign 22, 

23,  275,  276,  277,  279 

Manufacturing    20. 

21,  274,  275 

Personal  property  of  corporations,  domestic  and  foreign 18, 

265,  267,  270,  271,  279 

Real    estate   of 18. 

19,   265,   266,   267.   269,  279 

Recommendation  of  Commission  on  Taxation 17,  18,  19,  22 

State  receipts   from 284 

Taxation  of  tangible  assets 19, 

269,  271,  272 

Cost  of  Government : 

Administration  of  the  State 384 

Agriculture    383 

Charities,  benevolent     380 

Blind 388 

Consumptive    388 

Insane    388 

Penal  and   reform 3i88 

Chesapeake  Bay  and  oysters 383 

City,  town  and  village  government 394-399 

Collection  of  taxes 227,  230,  231 

County   government 393 

Debt    385 

Executive    department 382 

Health    383 

Interest  and  sinking  fund  on  debt 385 

•Tudiciary    department 382 

Legislative  department 382 

Militia    390 

Miscellaneous    391 

Roads    385 

Schools    389-390 

State,  classified  receipts  and  expenditures 42,   375,  381 

Cost  of  reassessment  in   1910 214 

County   Commissioners,    establishment    of 219 

County  Supervisors  of  Assessment  : 

Appointment    12 

Powers    12 

County   treasurer  system 227-231 

Debt  (per  capita)   compared  with  assessed  valuation 426 


Index  433 

Page. 

DPbl  : 

Amiiunt     of 327, 

402,  425,  426 

Gonpral   proixMty   tax   for 43 

Levies   for 40,   47.   48 

lax   on   i)ublic 33 

317,  31S,   320,   324,   325,   326 

Delaware    20. 

31.   44.  45,   275,   286,  2i>6.   312,  318.  365 
Deductions   (see  corporations). 

Deposits  : 

Increase  in  deposits  of  national  banlfs 290 

In    savings   banks    (see  savings  banks.) 

Diagram   snowing  assessed   valuation   of   all    counties   and    State 180-206 

Discount  : 

Amounts    233 

First    applications 217 

Rate    233 

To  be  allowed  for  voluntarily  returning  securities 2!) 

Discount  system  of  collectors 227 

District  of  Columbia 44,  312.   365 

Dividends  of  national  banks 291 

Domestic  corporations   (see  corporations). 

Dorchester  County  : 

Assessment  in 14,   114,  i;07 

Assessors   in    1910 215 

Bonded    indebtedness 323-327 

Cities.  towns  and  villages  of 323.  329,  395 

Collection  of  taxes 220. 

222,  223.  224,  231,  249 

Cost  of  reassessment,   1910 214 

Fiscal  year  begins 232 

Levy    for   schools .        367 

Licenses    354,   358.   361 

Per  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax   rates .393 

Taxauie  basis  since   1877 1 90 

Earnings  of  national  banks 291 

Equalization  : 

Lack    of 57 

Need    for 9. 

10,   11,   13,  14.  15.  50 

Report  of  Commission  of  1888 173 

Excess   fees   of   office 43 

Executive  Department : 

Cost   of 382 

Executors'   Commissions  : 

Tax   on 316 

Exemptions    34 

Expenditures  : 

(See  Cost.) 


434  Index 

Page. 
Fairchild,  Frederick  R. 

Taxation   of  woodlands 345 

Fee  for  collectors  of  taxes 236 

Fee  system 237 

Recommendation   of  commission 36 

Female  traders'  licenses   (see  Licenses). 

Fertilizer    corporations 23,  282 

Finances  of  Maryland  : 

Manner  in  which  derived 43 

Fiscal  Year  : 

Date  of,   in   counties 232 

Florida 10, 

206.  312,  3.50.  .365 

Foreign    corporations : 

Entrance   fees   of 279 

Foreign  fertilizer  companies 23,  282 

Franchise   tax   of 22, 

27.5,   276,  277 
Recommendation   of  commission 22 

Foreign  shareholders   in  Maryland   corporations 267 

Forests : 

(See  Woodlands.) 

Franchise  tax  of  foreign   corporations 22, 

23,   275,  276,   277,  279 

Franchise  tax  on  savings  banks 26,   301,  302 

Frederick  County  : 

Assessment  in 13.    117,   207 

Assessors   in    1910 215 

Bonded    indebtedness 327 

Cities,   towns,   and  villages   of 329-396 

Collection    of   taxes 220, 

222,  223,  224,  231,  250 

Cost  of  reassessment,   1910 214 

Fiscal  year  begins 232 

Levy   for  schools 367 

Licenses    354,  358,   361 

Per  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax   rates 393 

Taxable  basis  since  1877 191 

Freight  car  companies 21-281 

Frequency   of  reassessment 171 

Funded  debt  of  the  State 40 J 

Furniture  : 

Assessment  of  (see  each  county.) 

Exemption   of  $300 34-80 

Garrett  County  : 

Assessment   in 13, 

28,  120,  207.   212,  310 

Assessors   in    1910 215 

Bonded    indebtedness 327 

Cities,   towTis  and  villages  of 329-396 


Index  435 


Page. 

Collection   of  taxes 220, 

222,  22.3,  224,  2.31,   2.51 

Cost  of  reassessment,   1910 214 

Fiscal  year  begins 232 

Levy    for   schools 367 

Licenses   354,  3."»8,  361 

Per  capita  cost  of  government 393 

Receipts  from  all  sources .^93 

Tax    rates 393 

Taxable  basis  since   1877 192 

Georgia     39, 

296,  312,  317,  319,  341,  3.50,  365,  366 

General  Property  Tax  : 

For  what  purposes  levied 43,  46,   47 

Rates    47-48 

Receipts   from   in   Maryland 44-377 

States'  receipts  from 44 

General   sinking   fund 415-416 

Good  roads,  effect  on  value  and  assessment  of  abutting  property 40 

Gross   receipts   taxes ^1. 

39,  279,  280,  281,   282,  283 

Harford  County  : 

Assessment  in 62,  123,  207 

Assessors   in    1910 215 

Bonded   indebtedness 327 

Cities,  towns  and  villages  of 330-396 

Collection    of   taxes 220, 

222,  223,  224,  231,  252 

Cost   of  reassessment,   1910 214 

Fiscal   year   begins ^^32 

Levy   for   schools 367 

Licenses    354,   358,  361 

Per  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax    rates 393 

Taxable  basis  since  1877 ' 193 

Highways   (Public)    Loan  of  1910: 

Comments    421 

Data    412 

Levies    47 

Howard  County  : 

Assessment    in 126-207 

Assessors   in    1910 215 

Bonded    indebtedness 327 

Cities,  towns  and  villages  of 330-396 

Collection   of   taxes 220, 

222,  223,  224,  231,  253 

Cost  of  reassessment,   1910 214 

Fiscal    year   begins 232 

Levy    for   schools 367 

Licenses   354,   358,  361 

Per  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax    rates '.        303 

Taxable  basis  since  1877 194 


436  Index 

Page. 

Idaho    10, 

297,  312,  318.  319,  365 

Illinois    • 44, 

286,  297,  312,  344,  365 

Income  Taxation  in  Wisconsin 33 

Increase  in  assessed  valuations,  1877-1912 207,  208,  209 

Indiana   10, 

44,  297,  312,  318,  319,  365 

Inheritance  Taxation  : 

Amounts    received    from 43,  378 

Charitable    institutions 315-316 

Collateral    rate 311 

Direct  inheritance 32,   311 ,   314 

Receipts  from  in  other  States 44 

Shares  in  Maryland  corporations  held  by  non-resident  decedents...        314 
Table  showing  rates,  exemption,  etc 312-314 

Insane  Asylum  Loan  of  1902  : 

Comment    417 

Data    407 

Levies  for 47 

Insolvencies,  meaning  of  term  in  Maryland 236 

Inspection  for  purposes  of  fixing  amount  of  licenses 35-357 

Instalment  Bonds  : 

(See  Serial  Bonds.) 

Insurance  Companies  : 

Fees  of 27,  43,  303 

Intangible  personal  property,  the  term  in  Maryland 305 

Intangible  Personal  Property  : 
(See   Securities.) 

Interest : 

Amount  from  each  county  on  taxes  in  arrears 234-235 

Investigation  : 

Method    of 72 

Icwa    44, 

297,  312,   318,   319,   344,  346.  365 

Judiciary  Department : 

Cost   of 382 

Kansas    10, 

44.  297,  312,  318,  319,  344,  365 

Kent   County : 

Assessment  in 13,  129,  207,  212 

Assessors   in    1910 215 

Bonded   indebtedness 327 

Cities,  towns  and  villages  of 330-396 

Collection   of   taxes 220, 

222,  223,  224,   231,  254 

Cost  of  reassessment,  1910 214 

Fiscal   year   begins 232 

Ijcvy   for  schools 367 

Licenses    354,  358,   361 

I'er  capita  cost  of  government 393 


Index  437 

PaRc. 

Hcceipts    from    a'l    sources Hfir? 

Tax     rates 393 

Taxable  basis  since   1877 I95 

Kentuclcy     'i:i, 

2!)G,  ni2.  ;.',:,().  :>,*;:,,  366 

Legislature  : 

(  ost     of 382 

Length    of   State   loans 52-423 

Levies  for  taxes 46.  47,  48,  49 

Sci'.ools   36,  367 

Time    of 62 

Levy    courts 1:19 

Levying  for  taxes : 

Maryland   metliod   of 219 

Licenses  • 

Automobile  or  motor  vehicle 360 

Karliest    laws 349 

Female  traders' 35,    354,    355 

Liquor     352,  358 

Receipts     379 

Miscellaneous    36 1 

State's   i)articipation    in 35 

Traders'     35^ 

340.  351.  352,  354.  355 

Liijuor  Licenses  : 

(See  Licenses.) 

T-oans  : 

State  loans  since  1902 401 

Sinking  funds   of 404-405 

Loans  and   Discounts : 

Of  national   banks 292 

Louisiana     296, 

311,  312,  318,  319,  .350,  365 

Maine    10, 

44,  296,  312.  318,  344,  345,  365 

Manufacturing  corporations 20,   21.   274.   275 

Maps,    tax 4i 

Maryland  Kducational  Commission  : 

Recommendation  for  distribution  of  State  school  fund 368 

Massachusetts     44. 

53,  286,  296,  312,  318,  310,  344.  346,  365 

Michigan    10. 

31.  30,  44,  286,  297,  308,  312,  318,   341,  344.  348.  365,  366 
Mineral   Deposits  : 

Taxation    of " 33-333 

Taxation  of  in  States,  classified 341 

Mines : 

Assessment  of  surface  of 336,  339,  340 

Minnesota 10, 

32,  44,  297,  312,  317,  318,  341,  .344.  365 
Miscellaneous   tax    receipts 44-380 


438  Index 

Page. 

Mississippi     39, 

290,   312,   317,   318,   350,   365,  366 

Missouri    44, 

286,  297,  312,  341,  350,  365 

^Montana     .  . ; 10, 

297,  312,  318,  341,  365 

Montgomery  County  : 

Assessment    in 132-207 

Assessors   in   1910 215 

Bonded    indebtedness 327 

Cities,  towns  and  villages  of 330-397 

Collection    of   taxes 220, 

222.  223.   224,  231,  255 

Cost  of  reassessment,   1910 214 

Fiscal  year  begins 232 

Levy   for  schools 367 

Licenses    354,  358,   361 

Per  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax   rates 393 

Taxable  basis  since  1877 196 

Mortgage  recording  tax  in   Xew  York 31-44 

Mortgages,   taxation  of 31 

Motor  vehicles    (see  License.) 

Municipal  basis  of  assessments 15,  68,  170,  270 

(See  each  county.) 

National  banks,   increase  in  number 296 

Nebraska    44, 

297,  313,  318,  341,  344,  .347,  365 

Nevada    10. 

297,  313,  317,  318,  341,  365 

New    Hampshire 10, 

44,  296,  313,  318,  341,  344,  347,  365 

New    Jersey 10, 

20,  44,  45,  275,  286,   294,  296,  313,  317,  318,  365 

New  Mexico   297, 

313,  317,  319,  341,  365 

New    York 10, 

20,  31,  44,  45,  236,  275,  286,  294,  296,  306,  313,  317,  319,  344,  348,  365 
New  York  : 

One  per  cent,  bank  tax  law 294-296 

Secured   debt   tax 306 

Nfcw  Y'ork  City  : 

Tax  paid  by  banks  in 25 

(See  289,  290,  291,  292,  298.) 

Non-Resident  Decedents  : 

Shares  of,  in  Maryland  corporations 3i4 

Non-Residents  : 

Tax  against  shares  of  Maryland  corporations 267 

North   Carolina 10. 

296,  313,  317,  318,  341,  350,  365 


Index  439 

Page. 

North    Dakota 10, 

44,  297,  313,  341,  344,  347,  365 

Ohio    10, 

44,  170,  268,  297,  313,  318,  341,  342.   365 

Oklahoma 33, 

297,  313,  318,  319.  365 

One  per  CQpt.  bank  tax 294 

Oregon     10, 

297,  313,  318.  365 

I'enaltics  : 

For  non-pa.yment   of  taxes L'35-236 

To  be  imposed  for  failure  to  return  securities 29 

renitentiary  Loan  : 

Comments    '.  .  .  .  416 

Data 406 

Levies    for 47 

Pennsylvania    20, 

31,  44,  45,  275,  286,  294,  296,  306,  311,  313,  318,  342,  344,  347,  348,  350,  365 

Pennsylvania  one  per  cent,  bank  tax  law 294 

Per  capita  cost  of  State,  county,  city,  town  and  village  government 392-399 

Per  capita  debt  of  the  State 425 

Per  capita  resources  of  banks 289 

Percentage  of  collection  of  current  taxes 10-220 

Percentage  of  sinking  fund  to  State  debt 425 

Personal  Property  : 

Assessment    60 

Coi-porations    18, 

19,  265,  268,  270,  271,  279 
(See  ea.ch  county.) 

Philadelphia  : 

Tax  paid  by  banks  in 25 

(See  289,  290,  291,  292,  298.) 
Pittsburgh  : 

Tax  paid  by  banks  in 25 

(See  289,  290,  291,  292,  298.) 

Plant    exemptions 34,  268 

Plats     41 

I'rince  George's  County  : 

Assessment    in 136-207 

Assessors    in    1910 215 

Bonded   indebtedness 327 

Cities,  towns  and  villages  of 330-397 

Collection    of   taxes 220, 

222,  223,  224,  231,  256 

Cost  of  reassessment,   1910 214 

Fiscal   year   begins 232 

Levy  for  schools 367 

Licenses    354,  358,  361 

Per  capita  cost  of  government 393 

Receipts  from   all  sources 393 

Tax    rates 393 

Taxable  basis  since  1877 19t 


440  Index 


Production   Tax  on   Minerals  : 
(See  Minerals.) 

Public   Building   Loan    of    1004  : 

Comments    49,  410 

Data    411 

Levies    " 47 

Public  Obligations  : 

Baltimore  ("ity  stock  tax '.  .  .  .r!24-32r) 

Classiflcation  of  taxation  methods  in  Maryland 320. 

321,  322,  323,  324 
Extraterritorial   exemptions 320 

Recommendation  of  Commission,  concerning  taxation 33 

States    exempting 317-318 

Tax  on.  payable  at  source 324 

Queen   Anne's   County  : 

Assessment  in 1 3,   140.  207 

Assessors   in    1910 215 

Bonded    indebtedness 327 

Cities,  towns  and  villages  of 330-i}97 

Collection   of  taxes 220. 

222,  223,  224,  231,  257 

Cost  of  assessment,   1910 214 

Fiscal  year  begins ; 232 

Levy    for   schools 367 

Licenses    3.-54.   358,   361 

Per  capita  cost  of  government 393 

Receipts   from   all   sources 393 

Tax    rates.  .  .* 393 

Taxable  basis  since  1877 198 

Railroads  : 

Taxation  of 265,   280,  281 

Railroad    Property  : 

Assessment    of 66 

(See  each   county.) 

Rates  : 

State,   of   taxation 43, 

46,  47,  48,  49,  211.  429 

Ratio  of  assessment  to  valuation 15 

(See   each   county.) 

Assessment    18,  267 

Real  Estate  of  Corporations  : 

Assessment    , 18,  267 

Deductions    265,   266.  267,  296 

Taxatbm  of 266.  267.  268,  269.  279 

Reassessment : 

Acts  providing  for 1 69. 

170,  171.   172.   17::,  174 

Frequency    of 171 

Receipts  : 

Bond   issues 384 

Chesapeake   Bay   and   oysters 378 

Corporations  other  than  tax  on  real  estate 273,  284,  377 

Corporations,     quasi-public 377 

Department  s  and   civil  ofBcers 376 


Index  441 

Pdgp. 

I Hi-Pct  or  general  proporty  tax 370 

Karnings  of  institutions 37S 

(Jross  receipts  tax 377 

Inheritances    37g 

Interest     37^ 

Licenses    379 

Afisceilaneous    3g0 

Productive   assets 37g 

Tax  on   Raltimore  City  stoclv 380 

Receipts  into  tlie  treasury,  1911  and  1912 37r, 

Recommendations  of  tlie  Commission  for  permanent  State  tax  commission.  .         11. 

12,  13,  54,  55 

Redemptions  and  cancellations  of  loans 53,  403,  414 

Rhode    Island 10. 

44,  296,  313,  318,  344,  346,  365 

Roads  : 

Appropriations    for , 40 

Cost   of 385 

Kffect  on  value  of  abutting  property 40 

Maintenance  of 43,  46,  48,  49 

Sinlving  fund  of  1908  loan 51 

Russell  Sage  Foundation  : 

On    schools 39 

Salaries  : 

Payment  of  officials  from  fees 36 

St.  Louis  : 

Tax  paid  by  banks  in 25 

(See  289,  290,  291,  292,  298.) 

St.  Mary's  County  : 

Assessment  in 14,    145,   207 

Assessors    in    1910 215 

Bonded    indebtedness 327 

Cities,  towns  and  villages  of 331-397 

Collection    of   taxes 220, 

222,  223,  224,  231,  258 

Cost  of  reassessment,    1910 ' 21-) 

Fiscal   year   begins 232 

Levy   for  schools 367 

Licenses    354,  358,  361 

Per  capita  cost  of  gov(>rnment 393 

Receipts  from  all  sources 393 

Tax    rates 393 

Taxable  basis  since  1877 199 

Sanatorium  Loan  : 

Comments    422 

Data    413 

Levies     47 

Savings  Banks  : 

Amount  of  deposits  in 301 

Deposits   in   Carroll  county 14,  103 

Franchise    tax    on    deposits 14,   26,   39,  43,  302 

Schools  : 

Attendances    373 

Contribution  of  State 306 

Contribution  of  counties 366 


442  Index 

Page. 

Cost     (State) 389-390 

Levies  by  counties 39,  367 

Maryland  plan  for  distribution  of  fund 368 

Method  by  which  taxes  are  raised  by  localities 363 

Method  by  which  taxes  are  raised  by  the  States 363 

Payment  to  counties   from   State  contrasted  with  payment  for  all 

purposes  to  State  from  counties 39,  374 

Per  capita  cost  of  children  in,  based  on  average  enrollment 370 

Per  capita  cost  of  children  in,  based  on  average  attendance 371-372 

Percentage  of  State  and  local  contributions  of  all  States 365 

Recommendation   of    Commission 36,  37,  38,  39 

State's  contribution  for  schools 36,  37,  364 

Taxes    for 363 

School  book  fund,  distribution  of 368 

School  population  of  counties 369 

Secured  debt  tax  of  New  York 44-306 

Securities : 

Amount  assessed  i-i  each  county 310 

Amount   of,    ovvTied    by    corporations,    trust   estates   and    individuals 

in    Baltimore 309 

Assessed  in  Baltimore  city  from  1896  to  1914 308 

Classification  for  State  taxation 305 

Discount  for  voluntary   return 27 

Division  of  tax  from,  between  counties  and  cities 305 

Local  variations  in 70 

Subject  to  the  30  cents  per  $100,  or  3-mill  tax .  305 

Voluntary    return 27 

Separation  of  sources 45 

Serial    bonds 53,  424 

Shares  of  Stock  : 

Assessment  of 267,  268,  273 

Domestic    corpora;tions 265,  273 

Foreign  corporations 265,   2  75,  278 

Held   by   non-residents 267 

Receipts  from  taxation  of 35,  273,  377 

Taxation  of 265,  272,  273,  285 

Sinking  Funds  : 

Present  method  of  creating 49, 

50,  52,   53,  423,  424 

Road  loan  of  1908 49-50 

(See  each  loan.) 

Somerset  County  : 

Assessment    in 148,  207 

Assessors   in    1909 215 

Bonded    indebtedness 327 

Cities,  towns  and  villages  of 331-398 

Collection    of   taxes 220, 

222,  223,  224,  231,  259 

Cost  of  reassessment,   1909 214 

Fiscal   year   begins 232 

Levy    for  schools 367 

Licenses 354,   358,  361 

Per  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax    rates 393 

Taxable  basis  since  1877 20O 


Index  4^3 

Page. 
Sources   of  revenue 43-375 

South     Carolina 33, 

296,  313,  318,  319,  341,  350,  365 

South    Dakota .- 10, 

44,  297,  313,  341,  365 
State  Buildings  and  Improvement  Loan  of  1902 : 

Comments    53-419 

Data 409 

Levies     47 

States  exempting  public  obligations  from  taxation 317 

States  exempting  municipal  obligations  from  taxation 318 

State  Insane  Hospital  Loan  : 

Comment     422 

Data    413 

Levies    47 

State  Loan  of  1902  : 

Comment     50,  419 

Data    410 

Levies     47 

State  Road  Loan  of  1908  : 

Comment 419 

Data    412 

Over^coUections 51-52 

Proper  sinking  fund 51-52 

Sinking    fund 50-51-52 

Levies    47 

State  Tax  Commission  of  1888 170-175 

State  Tax  Commission  Proposed  : 

Number    It 

Term     11 

State  Tax  Commissioner : 

Assessment   of  shares 17, 

18,  267,  271,  285 

Establishment    266 

Report  of  corporations   to 267 

Stocks  and  iBonds  : 

(See  corporations,  domestic  and  foreign.) 

(See  pulblic  obligations.) 

Talbot  County  : 

Assessment  in 13,  153,  207,  212 

Assessors   in    1910 215 

Bonded    indebtedness 327 

Cities,   towns  and  villages  of 331-398 

Collection   of   taxes " 220, 

222,  223,  224,  231,  260 

Cost  of  reassessment,   1910 214 

Fiscal   year   begins 232 

Levy   for   schools 367 

Licenses    354,  358,  361 

Per  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax    rates 393 

Taxable  basis  since  1877 201 


444  Index 

Page. 
'J'angible  Assets  of  Corporations  : 
( Soe  Corporations.) 

Tax   on   Baltimore  City   stoek 325-326 

Tax  Rates  : 

Cities,   towns  and   villages 304-390 

of     counties .i93 

of  State  of  Maryland 43. 

46,  47,  48,  40,  211.  420 

Taxes  : 

Maryland  method  of  levying  State  taxes 210 

.  When    due 232,  233 

Telephone  Companies  : 

Variation   in   assessments 67 

Tennessee     296. 

313.  318.  341,  350,  365 

Texas    10, 

30,  206,  313.  318.   341.  3.->0.  36.-.,  366 

Time    of    levy 62 

Town  Assessment  : 

Local     varintions 68 

(See  also  each  county.) 

Traders'   Licenses  : 

(See  Licenses.) 

True   consideratio I    in   deeds 41 

Trust  Companies  : 

Taxation    of 3(i2 

United  States  Commissioner  of  Corporations  : 

Table    from 44 

Utah    10, 

207,  313,  318,  310,  341,  365 

Variation  of  ratio  of  assessments  between  counties 63,  64,  65,  66 

Variations    within    counties 67-68 

Vermont    44, 

45,  296,  313,  318,  344,  346,  365 

Virginia    33, 

30,  286,  294,  296,  313,  318,  341,  342,  350,  365 

Washington    10, 

297,  313,  318,  341,  344,  347,  365 

Washington   County  : 

Assessment  in 14,  157,  207 

Assessors   in    1910 215 

Bonded    indebtedness 327 

Cities,  towns  and  villages  of 331-398 

Collection    of   taxes 220, 

222,  223,  224,  231,  261 

Cost  of  reassessment,   1010 214 

Fiscal  year  begins 232 

Levy   for  schools 367 

Licenses    354,   358,   361 

I'er  capita  cost  of  government 393 

Receipts  from  all  sources 393 

Tax    rates 393 

Taxable  basis  since  1877 202 


Index  445 

Page. 

West     Virginia 20G, 

3i:5,  341,  350,  365 

Wicomico  County  : 

Assessment    in 161,  207 

Assessors   in   1910 215 

Bonded     indebtedness 327 

Cities,  towns  and  villages  of 331-398 

Collection    of   taxes 220, 

222,  223,  224,  231,  262 

Cost   of  reassessment,    1910 214 

Fiscal  year  begins 232 

Levy   for   schools 36  < 

Licenses    354.   358,  361 

Per  capita  cost  of  government 393 

Receipts  from   all   sources 393 

Tax    rates 393 

Taxable  basis  since  1877 203 

Wisconsin 10, 

33,   44,  297,  313,  .344,  346,  365 

Wooded  area  of  counties   of  Maryland .>43 

Woodlands  : 

States  having  legislation  on  taxation  of 344 

Taxation     of 33,  343 

Worcester  County  : 

Assessment    in 13, 

14,   28,   165,   207,   310 

Assessors   in   1909 215 

Bondedi    indebtedness 327 

Cities,  towns  and  villages  of 331-399 

Collection    of   taxes 220, 

222,  223,  224,  231,  263 

Cost  of  reassessment,    1909 214 

Fiscal  year  begins 232 

Levy    for   scnools 367 

Licenses    354,   358,   361 

Per  capita  cost  of  government ' 393 

Receipts  from  all   sources 393 

Tax    rates 393 

Taxable  basis  since  1877 204 

Wyoming    297, 

313,  318,  319,  344,  365 


UNIVERSITY  OF  CALIFORNIA  LIBRARY 

Los  Angeles 
This  book  is  DUE  on  the  last  date  stamped  below. 


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JfH 


AA    000  565  900    8 


HJ 

2412 
A7 
1913 


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